Final answer:
The Independent Review Committee of a mutual fund has the authority to oversee conflict of interest transactions and ensure regulatory compliance, as part of the oversight structures like the board of directors, auditing firms, and large shareholders.
Step-by-step explanation:
Which of the following does the Independent Review Committee of a mutual fund have the power to oversee and approve? To understand this, it's essential to look at the structures in place for corporate governance. The board of directors, elected by shareholders, serves as the primary oversight force for a corporation's top executives, ensuring that the company is managed in the shareholders' best interests. Furthermore, an auditing firm is often employed to examine financial records and verify the accuracy of reported financial data. Meanwhile, outside investors and large shareholders, such as those investing in mutual funds or pension funds, represent another layer of governance, monitoring their investments and influencing corporate decisions. However, as the Lehman Brothers case indicates, these mechanisms can sometimes fail, leading to misinformation and financial misrepresentation. While not detailed here explicitly, an Independent Review Committee typically oversees aspects like conflict of interest transactions and ensures the mutual fund operates fairly and in accordance with regulatory requirements.