Here are the steps to reset the password for caroot.
From the folder where Arcserve is installed run from a command prompt the following:
authsetup /p "passwordhere"
This should talk about a minute and come back with a message that said successfull.
If the above didnt work the first time try the following: ( this will restart the CA services). You could also reboot the machine.
Then try the authsetup command again.
ItFixed it for me so I hope it helps someone else.