Answer 1.
In the case given, definitely it is the fraud perpetrator is the responsible one. However, even though the culprit is not found or even when he is found, the accounting company as well as the auditor also is responsible for the crime to some extent.
The company is supposed to track all the ongoing problems and maintain control systems, on lack of which definitely someone is going to exploit the situation of weakness. The agency problem, fraudulent activities, unlawful practices and so on, these all are required to be monitored and avoided for which a company should always prepare a control mechanism The company holds liability to its stakeholders to safeguard their property for which the company should have skepticism of employees and should have mechanism developed for safety. Thus, the company holds responsibility and is required to compensate.
At the same time, the auditor is also responsible. He is the one of the element employed by the company to control the hanky-panky over the financial matters. His duty is to clear out the financial matter of the company and if he is not able to trace out the financial matters in black and white, who else will then.
Thus in my opinion, the company and the auditor should be held responsible after the culprit.
B Discussion
I disagree to the first argument about bluegrass duo because they have paid for transferring their responsibility to the accounting firm. They too should have tracked the money, but very primarily, accounting firms should be held responsible. Also, I disagree about accounting firm have “some” responsibility. It is their major responsibility to keep the control system strong enough
C Discussion
I do agree with the argument about first the company should be held responsible and then the auditor and only then the victims. There is no way the victim could have tracked their money all the time, and that is why they have transferred the task to the accounting company for whom they pay I guess pretty well.