Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ~~Yes~~ ☑Yes No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ~~Yes~~ ☑Yes No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of ‘large accelerated filer’, ‘accelerated filer’, ‘smaller reporting company’, and ‘emerging growth company’ in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of ~~October 26, 2021,~~April 25, 2022, there were outstanding ~~124,606,097~~111,488,239 ordinary shares, nominal value $0.000304635 per share, of the registrant.

The following definitions apply throughout this quarterly report unless the context requires otherwise:

We have included in this document ‘forward-looking statements’ within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934, which are intended to be covered by the safe harbors created by those laws. These forward-looking statements include information about possible or assumed future results of our operations. All statements, other than statements of historical facts, that address activities, events or developments that we expect or anticipate may occur in the future, including such things as our outlook, the impact of the ~~COVID-19~~global pandemic on our business,~~impact of the termination of the business combination with Aon plc and the divestitures contemplated in connection therewith,~~ future capital expenditures, ongoing working capital efforts, future share repurchases, financial results (including our ~~revenue)~~revenue, costs or margins), the impact of changes to tax laws on our financial results, existing and evolving business strategies and acquisitions and dispositions, including the sale of Willis Re to Arthur J. Gallagher & Co. (‘Gallagher’), demand for our services and competitive strengths, goals, the benefits of new initiatives, growth of our business and operations, our ability to successfully manage ongoing leadership, organizational and technology changes, including investments in improving systems and processes, our ability to implement and realize anticipated benefits of any cost-savings initiatives including the multi-year operational Transformation program, and plans and references to future successes, including our future financial and operating results, plans, objectives, expectations and intentions are forward-looking statements. Also, when we use words such as ‘may,’ ‘will,’ ‘would,’ ‘anticipate,’ ‘believe,’ ‘estimate,’ ‘expect,’ ‘intend,’ ‘plan,’ ‘continues,’ ‘seek,’ ‘target,’ ‘focus,’ ‘probably,’ or similar expressions, we are making forward-looking statements. Such statements are based upon the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. All forward-looking disclosure is speculative by its nature.

There are important risks, uncertainties, events and factors that could cause our actual results or performance to differ materially from those in the forward-looking statements contained in this document, including the following:

The foregoing list of factors is not exhaustive and new factors may emerge from time to time that could also affect actual performance and results. For more information, please see Part I, Item 1A in our Annual Report on Form 10-K, and our subsequent filings with the SEC. Copies are available online at http://www.sec.gov or ~~www.willistowerswatson.com.~~www.wtwco.com.

Although we believe that the assumptions underlying our forward-looking statements are reasonable, any of these assumptions, and therefore also the forward-looking statements based on these assumptions, could themselves prove to be inaccurate. Given the significant uncertainties inherent in the forward-looking statements included in this ~~document,~~Quarterly Report on Form 10-Q, our inclusion of this information is not a representation or guarantee by us that our objectives and plans will be achieved.

Our forward-looking statements speak only as of the date made and we will not update these forward-looking statements unless the securities laws require us to do so. With regard to these risks, uncertainties and assumptions, the forward-looking events discussed in this document may not occur, and we caution you against unduly relying on these forward-looking statements.

(ii)

Attributable to the divestiture of ~~shares in thousands)~~

~~(Unaudited)~~

Nine Months Ended September 30, 2020

Shares outstanding

Additional paid-in capital

Retained earnings

Treasury shares

AOCL ⁽ⁱ⁾

Total WTW shareholders’ equity

Non-controlling interests

Total equity

Balance as of December 31, 2019

128,690

$
10,687

$
1,792

$
(3
)

$
(2,227
)

$
10,249

$
120

$
10,369

Net income

—

—

305

—

—

305

8

313

Dividends declared ($0.68 per share)

—

—

(88
)

—

—

(88
)

—

(88
)
Dividends attributable to non-controlling interests

—

—

—

—

—

—

(1
)

(1
)
Other comprehensive loss

—

—

—

—

(219
)

(219
)

(1
)

(220
)
Issuance of shares under employee stock
   compensation plans

36

3

—

—

—

3

—

3

Share-based compensation and net settlements

—

9

—

—

—

9

—

9

Foreign currency translation

—

4

—

—

—

4

—

4

Balance as of March 31, 2020

128,726

$
10,703

$
2,009

$
(3
)

$
(2,446
)

$
10,263

$
126

$
10,389

Net income

—

—

94

—

—

94

8

102

Dividends declared ($0.68 per share)

—

—

(88
)

—

—

(88
)

—

(88
)
Dividends attributable to non-controlling interests

—

—

—

—

—

—

(12
)

(12
)
Other comprehensive income

—

—

—

—

56

56

—

56

Issuance of shares under employee stock
   compensation plans

37

2

—

—

—

2

—

2

Share-based compensation and net settlements

—

12

—

—

—

12

—

12

Reduction of non-controlling interests ⁽ⁱⁱ⁾

—

—

—

—

—

—

(1
)

(1
)
Other

—

(3
)

—

—

—

(3
)

—

(3
)
Foreign currency translation

—

(1
)

—

—

—

(1
)

—

(1
)
Balance as of June 30, 2020

128,763

$
10,713

$
2,015

$
(3
)

$
(2,390
)

$
10,335

$
121

$
10,456

Net income

—

—

121

—

—

121

1

122

Dividends declared ($0.68 per share)

—

—

(89
)

—

—

(89
)

—

(89
)
Dividends attributable to non-controlling interests

—

—

—

—

—

—

(9
)

(9
)
Other comprehensive income

—

—

—

—

137

137

1

138

Issuance of shares under employee stock
   compensation plans

108

3

—

—

—

3

—

3

Share-based compensation and net settlements

—

6

—

—

—

6

—

6

Reduction of non-controlling interests ⁽ⁱⁱ⁾

—

7

—

—

—

7

(9
)

(2
)
Foreign currency translation

—

(5
)

—

—

—

(5
)

—

(5
)
Balance as of September 30, 2020

128,871

$
10,724

$
2,047

$
(3
)

$
(2,253
)

$
10,515

$
105

$
10,620

our less than wholly-owned Miller subsidiary.

~~_________~~

~~(i)~~

~~Accumulated other comprehensive loss, net of tax (‘AOCL’).~~

~~(ii)~~

~~Attributable to the divestiture of businesses that are less than wholly-owned or the acquisition of shares previously owned by minority interest holders.~~

See accompanying notes to the condensed consolidated financial statements

WILLIS TOWERS WATSON PUBLIC LIMITED COMPANY

Notes to the Condensed Consolidated Financial Statements

(Tabular amounts in millions of U.S. dollars, except per share data)

(Unaudited)

Note 1 — Nature of Operations

Willis Towers Watson ~~plc~~public limited company is a leading global advisory, broking and solutions company that ~~helps clients around~~provides data-driven, insight-led solutions in the ~~world turn~~areas of people, risk ~~into a path for growth.~~and capital. The Company has more than ~~46,000 employees and services clients in~~44,000 colleagues serving more than 140 ~~countries.~~ countries and markets.

We design and deliver solutions that manage risk, optimize benefits, cultivate talent, and expand the power of capital to protect and strengthen institutions and individuals.

Our risk management services include strategic risk consulting (including providing actuarial analysis), a variety of due diligence services, the provision of practical on-site risk control services (such as health and safety and property loss control consulting), advisory services, leading-edge technology solutions, and unparalleled analytical and ~~advisory services~~modeling capabilities (such as hazard ~~modeling and reinsurance optimization studies)~~modeling). We also assist our clients with planning for addressing incidents or crises when they occur. These services include contingency planning, security audits and product tampering plans.

We help our clients enhance business performance by delivering consulting services, technology and solutions that ~~optimize~~effectively deliver valuable benefits and ~~cultivate talent.~~create an engaging employee experience. Our services and solutions encompass such areas as employee benefits, total rewards, talent, wellbeing and benefits outsourcing. In addition, we provide investment advice to help our clients develop disciplined and efficient strategies to meet their investment goals and expand the power of capital.

As an insurance broker, we act as an intermediary between our clients and insurance carriers by advising on their risk management requirements, helping them to determine the best means of managing risk and negotiating and placing insurance with insurance carriers through our unrestricted access to the global ~~distribution network.~~insurance market.

We operate a private Medicare marketplace in the U.S. through which, along with our active employee marketplace, we help our clients move to a more sustainable economic model by capping and controlling the costs associated with healthcare benefits. We also provide direct-to-consumer sales of Medicare coverage.

We are not an insurance company, and therefore we do not underwrite insurable risks for our own account. We ~~believe our broad perspective allows us~~help sharpen strategies, enhance organizational resilience, motivate workforces and maximize performance to ~~see~~uncover opportunities for sustainable success.

Segment Reorganization

On January 1, 2022, WTW realigned to provide its comprehensive offering of services and solutions to clients across two business segments: Health, Wealth & Career (‘HWC’), and Risk & Broking (‘R&B’). These changes were made in conjunction with changes in the ~~critical intersections between talent, assets and ideas -~~WTW leadership team, including the ~~dynamic formula that drives business performance.~~

~~Termination of Proposed Combination with Aon plc~~

~~On March 9, 2020, WTW and Aon plc (‘Aon’) issued an announcement disclosing that the respective boards of directors of WTW and Aon had reached agreement on the terms~~appointment of a ~~recommended acquisition of WTW by Aon. Under~~new chief executive officer who succeeded the ~~terms~~prior CEO as the chief operating decision maker on that date. Prior to January 1, 2022, we operated across four segments: Human Capital and Benefits; Corporate Risk and Broking; Investment, Risk and Reinsurance; and Benefits Delivery and Administration. Following the realignment, the two new segments consist of the ~~agreement each WTW shareholder would receive 1.08 Aon ordinary shares for each WTW ordinary share. At~~following businesses:

•

The HWC segment includes businesses previously aligned under the ~~time~~Human Capital and Benefits segment, the Benefits Delivery and Administration segment, and the Investment business, which was previously under the Investment, Risk and Reinsurance segment.

•

The R&B segment includes businesses previously aligned under the Corporate Risk and Broking segment, as well as the Insurance Consulting and Technology business, which was previously under the Investment, Risk and Reinsurance segment.

In addition, effective January 1, 2022, the Company manages its businesses across three geographical areas: North America, Europe (including Great Britain) and International.

Certain Investment, Risk and Reinsurance businesses that were part of the ~~announcement, it was estimated that upon completion~~results from continuing operations in the prior-year period presented were divested during 2021. The revenue and income from operations for these businesses have been included as ‘divested businesses’ in the reconciliations between the total segment results and the consolidated results of the ~~combination, existing Aon shareholders would own approximately 63% and existing WTW shareholders would own approximately 37%~~Company. However, the results of the ~~combined company~~divested Willis Re treaty-reinsurance business is presented as discontinued operations and is therefore excluded from the divested businesses presented in the segment reconciliations.

Segment results herein are presented on a ~~fully diluted basis.~~

~~The transaction was approved by~~retrospective basis to reflect the ~~shareholders of both WTW~~reorganization. See Note 4— Revenue, Note 5 — Segment Information, Note 6 — Restructuring Costs and ~~Aon during meetings of~~Note 8 — Goodwill and Other Intangible Assets for the respective shareholders held on August 26, 2020. On June 16, 2021, the U.S. Department of Justice filed suit in U.S. District Court in the District of Columbia against WTW and Aon, seeking to enjoin the proposed business combination between the two companies (among other relief). On July 26, 2021, WTW and Aon announced they had terminated the business combination agreement and that Aon had agreed to pay WTW $1 billion in connection with such termination, which was received by WTW on July 27, 2021 (the ‘Termination’ or the ‘Termination Agreement’). The $1 billion income receipt has been included in transaction and integration, net in the condensed consolidated statements of operations. Under the Termination Agreement, WTW and Aon on behalf of themselves and certain other related and affiliated parties, each agreed to release the other from all claims and actions arising out of or related to the business combination agreement and the transactions contemplated thereby, subject to certain exceptions.Company's segment-based presentations.

Note 2 — Basis of Presentation and Recent Accounting Pronouncements

Basis of Presentation

The accompanying unaudited quarterly condensed consolidated financial statements of ~~Willis Towers Watson~~WTW and our subsidiaries are presented in accordance with the rules and regulations of the SEC for quarterly reports on Form 10-Q and therefore docertain footnote disclosures have been condensed or omitted from these financial statements as they are not ~~include all of the information and footnotes~~ required byfor interim reporting under U.S. GAAP. We have reclassified certain prior period amounts to conform to the current period presentation due to the recognition of discontinued operations and assets and liabilities as held-for-sale (see below for further discussion). Additionally, certain amounts on the condensed consolidated statements of cash flows have been revised from their prior period classifications. See Note 19 - Supplemental Disclosures of Cash Flow Information for more information as to the nature of the revision and the amounts. In the opinion of management, these condensed consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, which are necessary for a fair presentation of the condensed consolidated financial statements and results for the interim periods. All intercompany accounts and transactions have been eliminated in consolidation. The condensed

consolidated financial statements should be read together with the Company’s Annual Report on Form 10-K, filed with the SEC on February ~~23, 2021,~~24, 2022, and may be accessed via EDGAR on the SEC’s web site at www.sec.gov.

The results of operations for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 are not necessarily indicative of the results that can be expected for the entire year. The Company experiences seasonal fluctuations of its revenue. Revenue is typically higher during the Company’s first and fourth quarters due primarily to the timing of broking-related activities. The results reflect certain estimates and assumptions made by management, including those estimates used in calculating acquisition consideration and fair value of tangible and intangible assets and liabilities, professional liability claims, estimated bonuses, valuation of billed and unbilled receivables, and anticipated tax liabilities that affect the amounts reported in the condensed consolidated financial statements and related notes.

Risks and Uncertainties ~~Related to~~of the ~~COVID-19 Pandemic and the Related~~ Economic Environment Caused by the Pandemic

The COVID-19 pandemic has had an adverse impact on global commercial activity, particularly on the global supply chain and workforce availability, and has contributed to significant volatility in the global financial markets including, among other effects, occasional declines in the equity markets, changes in interest rates and reduced liquidity on a global basis. ~~With regard~~

Supply and labor market disruptions caused by COVID-19 as well as other factors, such as accommodative monetary and fiscal policy and the Russian invasion of Ukraine, have contributed to significant inflation in many of the markets in which we operate. This impacts not only the costs to attract and retain employees but also other costs to run and invest in our business. If our costs grow significantly in excess of our ability to raise revenue, our margins and results of operations may be materially and adversely impacted and we may not be able to achieve our strategic and financial objectives.

Although we believe we have adapted to the ~~effects on our own business operations~~unique challenges posed by the pandemic surrounding how and those of our clients, suppliers and other third parties with whom we interact, the Company has regularly considered the impact of COVID-19 and the wider economic results on our business, taking into account our business resilience and continuity plans, financial modeling and stress testing of liquidity and financial resources.

Generally, the COVID-19 pandemic did not have a material adverse impact on our overall financial results during 2020 or on our results through the third quarter of 2021; however, during 2020 and through the first quarter of 2021, the COVID-19 pandemic had a negative impact on our revenue growth, primarily in our businesses that are discretionary in nature. We saw an increased demand for these services, which improved revenue growth, in the second and third quarters of 2021. We believe this positive trend could continue for the remainder of the year with some variability based on further disruptions to the supply chain, workforce availability, vaccination rates and further social-distancing orders in jurisdictions where we do ~~business.~~

~~We have considered this outlook as part of~~our work, we are also impacted by the significant estimates and assumptions that are inherent in our financial statements, including the collectability of billed and unbilled receivables, the estimation of revenue, and the fair value of our reporting units, tangible and intangible assets and contingent consideration. Although the primary revenue impact of the pandemic has been on certain discretionary lines of business, non-discretionary lines of business have also been, to some extent, adversely affected and may be adversely affected in the future. Further, reduced economic activity or disruption in insurance markets could reduce the demand for or the extent of insurance coverage. Also, the increased frequency and severity of coverage disputes between our clients and (re)insurers arising out of the pandemic could increase our professional liability risk. In 2021, global labor market shifts have become more pronounced, having a negative effect on workforce availability, which could hamper our ability to grow our capacity on pace with increasing demand for our services. We expect the market for talent to remain highly competitive for at least the next several months. We will continue to monitor the situation and assess any implications to our business and our stakeholders.

Note 3— Acquisitions and Divestitures

Acquisitions

The ~~extent~~Company completed an acquisition during the three months ended March 31, 2022 for a cash payment of $68 million and contingent consideration with an estimated fair value of $15 million.

Divestment of Russian Business

During the first quarter of 2022, WTW announced its intention to ~~which COVID-19 impacts our~~transfer ownership of its Russian subsidiary to local management who will operate independently in the Russian market. Due to the sanctions and prohibitions on certain types of business and ~~financial position will depend~~activities, WTW deconsolidated its Russian entities on ~~future developments, which are difficult to predict. These future developments may include the severity and scope~~March 14, 2022. The completion of the ~~COVID-19 outbreak,~~transfer is pending but the deconsolidation resulted in a loss of $57 million, which ~~may unexpectedly change or worsen,~~includes an allocation of Risk & Broking goodwill, and the types and duration of measures imposed by governmental authorities to contain the virus or address its impact. We continue to expect that the COVID-19 pandemic and the related impacts on the wider economic environment will negatively impact our revenue and operating results in fiscal 2021. We believe that these trends and uncertainties are similar to those faced by other comparable registrantswas recognized as a ~~result~~loss on disposal of ~~the pandemic~~.

~~Recent Accounting Pronouncements~~

~~Not Yet Adopted~~

~~There are no pending accounting pronouncements that are expected to have~~ a ~~significant impact~~business within other income, net on our condensed consolidated ~~financial statements.~~statement of comprehensive income. Further, certain Russian insurance contracts were placed historically by our U.K. brokers into the London market, the majority of which were under multi-year terms resulting in both current and non-current accounts receivables. Total net assets impaired, including accounts receivable balances related to our Russian business that are held outside of our Russian entities, were $81 million during the three

~~Adopted~~12

~~In December 2019, the FASB issued ASU No. 2019-12,~~ ~~Simplifying the Accounting for Income Taxes, which clarifies and amends existing guidance, including removing certain exceptions to the general principles of accounting for income taxes. Some of the changes must be applied~~months ended March 31, 2022. This impairment charge was recorded in other operating expenses on ~~a retrospective or modified retrospective basis while others must be applied on a prospective basis. The Company adopted this guidance as it became effective on January 1, 2021 without any impact to~~ our condensed consolidated ~~financial statements.~~statement of comprehensive income.

~~Note 3— Divestitures~~

Willis Re Divestiture

~~As part of the potential combination with Aon,~~On August 13, 2021, the Company entered into ana definitive agreement ~~with~~to sell its treaty-reinsurance business (‘Willis Re’) to Arthur J. Gallagher & Co. (‘Gallagher’), a leading global provider of insurance, risk management and consulting services, ~~to sell its treaty-reinsurance business (‘Willis Re’)~~

and certain of the Company’s corporate risk and broking and health and benefit businesses. Upon termination of the Aon combination, the definitive agreement with Gallagher automatically terminated in accordance with its terms.

~~On August 13, 2021, the Company entered into a new definitive agreement to sell Willis Re to Gallagher~~ for total upfront cash consideration of ~~$3.25~~$3.25 billion plus an earnout payable in 2025 of up to ~~$750~~$750 million in cash, subject to certain adjustments. The ~~completion of the~~ deal iswas subject to required regulatory approvals and clearances, as well as other customary closing conditions, and was completed on December 1, 2021 (‘Principal Closing’). Although the majority of the Willis Re businesses transferred to Gallagher at Principal Closing, the assets and liabilities of certain Willis Re businesses were not transferred to Gallagher at the time due to local territory restrictions (‘Deferred Closing’). The Deferred Closing is expected to be completed no later than the end of the ~~first~~second quarter of ~~2022.~~ 2022, and all net earnings of the Deferred Closing businesses accumulated between the Principal Closing and Deferred Closing are payable to Gallagher at that time. The Company recognized a preliminary pre-tax gain of $2.3 billion upon completion of the sale. The gain is subject to tax in certain jurisdictions, mainly in the U.S., and is predominantly tax-exempt in the U.K.

In connection with the transaction, the Company reclassified the results of its Willis Re operations as discontinued operations on its condensed consolidated statements of comprehensive income and reclassified Willis Re assets and liabilities as held for sale on its condensed consolidated balance sheets. The condensed consolidated cash flow statements were not adjusted for the divestiture. Willis Re was previously included in the Company's former Investment, Risk and Reinsurance segment. The assets and liabilities of the Willis Re businesses that will be transferred at Deferred Closing continue to be presented as held for sale on the condensed consolidated balance sheets at March 31, 2022 and December 31, 2021, and the results of these businesses following the Principal Closing have been included in income from discontinued operations on the condensed consolidated statements of comprehensive income.

The Company will account for the earnout as a gain contingency and therefore ~~will~~did not record any receivables upon close. Rather, the earnout will be recognized in the Company’s condensed consolidated financial statements, if it is received, in 2025.

~~After the divestiture is complete, upon satisfaction or waiver of the closing conditions, a~~A number of services are continuing under a cost reimbursement Transition Services Agreement (‘TSA’) in which WTW is providing Gallagher support including real estate leases, information technology, payroll, human resources and accounting. These services are expected to ~~continue~~be provided for a period not to exceed two years from the Principal Closing. Fees earned under the TSA were $12 million during the three months ended March 31, 2022 and have been recognized as a ~~Transition Services Agreement.~~

~~In connection with~~reduction to the ~~pending transaction,~~costs incurred to service the ~~Company has reclassified~~TSA and are included in continuing operations within other operating expenses on the ~~results of its Willis Re operations as discontinued operations on its~~ condensed consolidated statements of comprehensive ~~income and has reclassified Willis Re assets and liabilities~~income. Costs incurred to service the TSA are expected to be reduced as ~~held~~part of the Company’s Transformation program (see Note 6 — Restructuring Costs for ~~sale on its condensed consolidated balance sheets. Willis Re was previously included in~~a description of the ~~Investment, Risk and Reinsurance segment.~~program) as quickly as possible when the services are no longer required by Gallagher.

The following selected financial information relates to the operations of Willis Re for the periods presented:


	Three Months Ended September 30,					Nine Months Ended September 30,				Three Months Ended March 31,
	2021			2020		2021		2020		2022			2021
Revenue from discontinued operations	$	111		$	112	$	668	$	642	$	28		$	362
Costs of providing services
Salaries and benefits		97			93		291		281		6			104
Other operating expenses		29			12		60		43		0			17
Depreciation and amortization		—			—		1		2
Total costs of providing services		126			105		352		326		6			121
Other income, net		—			—		1		3		0			1
(Loss)/income from discontinued operations before income taxes	$	(15	)	$	7	$	317	$	319
Income from discontinued operations before income taxes											22			242
Adjustment to gain on disposal of Willis Re											(2	)		0
Provision for income taxes											(3	)		(52	)
Net income payable to Gallagher on Deferred Closing											(6	)		0
Income from discontinued operations, net of tax										$	11		$	190

The expense amounts reflected above represent only the direct costs attributable to the Willis Re business and exclude allocations of corporate costs that will be retained following the sale. Neither the discontinued operations presented above, nor the unallocated corporate costs, reflect the impact of any cost reimbursement that will be received under ~~a Transition Services Agreement following~~ the ~~closing of the transaction upon the satisfaction or waiver of closing conditions.~~TSA.

~~The following table summarizes the total assets~~Assets and liabilities ~~of Willis Re~~ classified as held for sale within our condensed consolidated balance sheets at both March 31, 2022 and December 31, 2021 are related to entities that are part of the ~~balance sheet dates presented:~~

September 30,
2021

December 31,
2020

Assets held for sale:

Cash and cash equivalents

$
53

$
50

Fiduciary assets

3,853

3,157

Accounts receivable, net

199

147

Fixed assets, net

1

1

Goodwill

812

812

Other intangible assets, net

8

8

Right-of-use assets

1

1

Other assets

34

40

Total assets held for sale

$
4,961

$
4,216

Liabilities held for sale:

Fiduciary liabilities

$
3,853

$
3,157

Deferred revenue and accrued expenses

101

118

Liability for pension benefits

1

2

Lease liabilities

1

1

Provision for liabilities

1

1

Other liabilities

163

126

Total liabilities held for sale

$
4,120

$
3,405

Deferred Closing. Certain amounts included in the condensed consolidated balance sheets have been excluded from the held-for-sale balances disclosed since the assets are not transferring under the terms of the sale agreement, and instead will be settled by the Company. At ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, these excluded~~2021, the amounts

of significant assets and liabilities related to the Willis Re businesses which were not transferred in the sale and are ~~comprised~~therefore not classified as held for sale on the condensed consolidated balance sheets are $3.2 billion and $2.6 billion of fiduciary assets ~~of $3.8 billion~~ and ~~$3.0 billion, respectively,~~liabilities, $53 million and ~~their corresponding equal fiduciary liabilities, and~~$71 million of accounts receivable ~~net balances of $155~~and $113 million and ~~$100~~$91 million of other current liabilities, respectively.

Miller Divestiture

On March 1, 2021, the Company completed the transaction to sell its U.K.-based, majority-owned wholesale subsidiary Miller for final total consideration of GBP 623 million ($818 million), which includes amounts paid to the minority shareholder. The ~~$356~~$356 million net tax-exempt gain on the sale was included in Other income, net in the condensed consolidated statement of comprehensive income ~~for~~during the ~~nine~~three months ended ~~September 30,~~March 31, 2021. Prior to disposal, Miller was included within the Company's former Investment, Risk and Reinsurance segment.

~~Max Matthiessen Divestiture~~

In September 2020, the Company completed the transaction to sell its Swedish majority-owned subsidiary MM Holding AB (‘Max Matthiessen’) for total consideration of SEK 2.3 billion ($262 million) plus certain other adjustments, resulting in a tax-exempt gain on the sale of $86 million, which was included in Other income, net in the consolidated statement of comprehensive income during the year ended December 31, 2020. Of the total consideration, the Company financed a SEK 600 million ($68 million) note repayable by the purchaser. The note has no fixed term but is repayable subject to certain terms and conditions and bears an interest rate that could range from 5% to 10%, increasing the longer the note remains outstanding. This note receivable is included in Other non-current assets in the condensed consolidated balance sheet. Prior to disposal, Max Matthiessen was included within the Investment, Risk and Reinsurance segment.

Note 4 — Revenue

~~All periods~~The prior-year period presented ~~have~~has been recast to exclude the revenue ~~and receivables~~ of Willis Re, which ~~have~~has been reclassified as discontinued operations ~~and assets held for sale, respectively,~~ on the Company’s condensed consolidated financial statements (see Note 3 – Acquisitions and Divestitures).

Disaggregation of Revenue

The Company reports revenue by segment in Note 5 — Segment Information. The following ~~tables present~~table presents revenue by service offering and segment, as well as ~~reconciliations~~a reconciliation to total revenue for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021. Along with reimbursable expenses and other, total revenue by service offering represents our revenue from customer contracts.

The prior year segment information has been retrospectively adjusted to conform to the current year presentation.

Three Months Ended September 30,

HCB

CRB

IRR

BDA

Corporate ⁽ⁱ⁾

Total

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

Broking

$
68

$
62

$
621

$
592

$
11

$
71

$
119

$
100

$
—

$
—

$
819

$
825

Consulting

561

529

39

31

111

97

—

—

2

1

713

658

Outsourced administration

122

126

17

16

4

4

123

126

—

—

266

272

Other

97

77

4

4

46

48

—

—

1

1

148

130

Total revenue by service offering

848

794

681

643

172

220

242

226

3

2

1,946

1,885

Reimbursable expenses and other ⁽ⁱ⁾

10

10

—

—

2

1

2

2

(9
)

(10
)

5

3

Total revenue from customer
contracts

$
858

$
804

$
681

$
643

$
174

$
221

$
244

$
228

$
(6
)

$
(8
)

$
1,951

$
1,888

Interest and other income ⁽ⁱⁱ⁾

4

2

16

6

—

—

—

—

2

1

22

9

Total revenue

$
862

$
806

$
697

$
649

$
174

$
221

$
244

$
228

$
(4
)

$
(7
)

$
1,973

$
1,897


	Three Months Ended March 31,
	HWC				R&B				Divested Businesses				Corporate (i)				Total
	2022		2021		2022		2021		2022		2021		2022		2021		2022		2021
Broking	$	271	$	250	$	696	$	717	$	0	$	45	$	4	$	0	$	971	$	1,012
Consulting		653		652		104		101		0		6		2		2		759		761
Outsourced administration		250		264		27		29		0		0		0		0		277		293
Other		64		61		61		57		0		0		0		1		125		119
Total revenue by service offering		1,238		1,227		888		904		0		51		6		3		2,132		2,185
Reimbursable expenses and other (i)		13		13		3		1		0		0		2		2		18		16
Total revenue from customer contracts	$	1,251	$	1,240	$	891	$	905	$	0	$	51	$	8	$	5	$	2,150	$	2,201
Interest and other income (ii)		6		6		3		20		0		0		1		1		10		27
Total revenue	$	1,257	$	1,246	$	894	$	925	$	0	$	51	$	9	$	6	$	2,160	$	2,228

(i)

Reimbursable expenses and other, as well as Corporate revenue, are excluded from segment revenue, but included in total revenue on the condensed consolidated statements of comprehensive income. Amounts included in Corporate revenue may include eliminations and impacts from hedged revenue transactions.

(ii)

Interest and other income is included in segment revenue and total revenue, however it has been presented separately in the above tables because it does not arise directly from contracts with customers.

Nine Months Ended September 30,

HCB

CRB

IRR

BDA

Corporate ⁽ⁱ⁾

Total

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

Broking

$
248

$
216

$
2,026

$
1,877

$
67

$
238

$
391

$
288

$
—

$
—

$
2,732

$
2,619

Consulting

1,732

1,642

128

118

348

282

—

—

6

4

2,214

2,046

Outsourced administration

377

376

58

57

12

11

377

378

—

—

824

822

Other

196

165

12

6

188

185

—

—

3

3

399

359

Total revenue by service offering

2,553

2,399

2,224

2,058

615

716

768

666

9

7

6,169

5,846

Reimbursable expenses and other ⁽ⁱ⁾

33

36

1

1

4

6

6

7

(9
)

2

35

52

Total revenue from customer
contracts

$
2,586

$
2,435

$
2,225

$
2,059

$
619

$
722

$
774

$
673

$
—

$
9

$
6,204

$
5,898

Interest and other income ⁽ⁱⁱ⁾

10

14

71

31

—

—

3

—

4

3

88

48

Total revenue

$
2,596

$
2,449

$
2,296

$
2,090

$
619

$
722

$
777

$
673

$
4

$
12

$
6,292

$
5,946

~~______________~~

~~(i)~~

~~(ii)~~

Interest and other income is included in segment revenue and total revenue. However, it has been presented separately in the above tables because it does not arise directly from contracts with customers. The significant increase in CRB’s interest and other income resulted from book-of-business settlements.

The following ~~tables present~~table presents revenue by the geography where our work is performed for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020. Reconciliations~~2021. The reconciliation to total revenue on our condensed consolidated ~~statements~~statement of comprehensive income and to segment revenue ~~are~~is shown in the ~~tables~~table above. The prior year geographic information has been retrospectively adjusted to conform to the current year presentation.


	Three Months Ended September 30,																								Three Months Ended March 31,
	HCB				CRB				IRR				BDA				Corporate				Total				HWC				R&B				Divested Businesses				Corporate				Total
	2021		2020		2021		2020		2021		2020		2021		2020		2021		2020		2021		2020		2022		2021		2022		2021		2022		2021		2022		2021		2022		2021
North America	$	485	$	465	$	310	$	287	$	45	$	39	$	239	$	224	$	2	$	1	$	1,081	$	1,016	$	779	$	772	$	277	$	266	$	0	$	5	$	2	$	2	$	1,058	$	1,045
Great Britain		137		120		143		138		86		117		—		—		—		—		366		375
Western Europe		135		129		116		112		18		44		—		—		1		1		270		286
Europe																										353		358		480		499		0		46		4		1		837		904
International		91		80		112		106		23		20		3		2		—		—		229		208		106		97		131		139		0		0		0		0		237		236
Total revenue by geography	$	848	$	794	$	681	$	643	$	172	$	220	$	242	$	226	$	3	$	2	$	1,946	$	1,885	$	1,238	$	1,227	$	888	$	904	$	0	$	51	$	6	$	3	$	2,132	$	2,185

Nine Months Ended September 30,

HCB

CRB

IRR

BDA

Corporate

Total

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

North America

$
1,430

$
1,403

$
865

$
816

$
136

$
117

$
760

$
660

$
7

$
5

$
3,198

$
3,001

Great Britain

427

363

471

435

343

401

—

—

—

—

1,241

1,199

Western Europe

444

404

521

483

69

139

—

—

2

2

1,036

1,028

International

252

229

367

324

67

59

8

6

—

—

694

618

Total revenue by geography

$
2,553

$
2,399

$
2,224

$
2,058

$
615

$
716

$
768

$
666

$
9

$
7

$
6,169

$
5,846

Contract Balances

The Company reports accounts receivable, net on the condensed consolidated balance sheet, which includes billed and unbilled receivables and current contract assets. In addition to accounts receivable, net, the Company had the following non-current contract assets and deferred revenue balances at ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020:~~2021:

	September 30, 2021		December 31, 2020
Billed receivables, net of allowance for doubtful accounts of $44 million and $40 million	$	1,360	$	1,589
					March 31, 2022		December 31, 2021
Billed receivables, net of allowance for doubtful accounts of $49 million and $45 million					$	1,381	$	1,504
Unbilled receivables		511		445		477		431
Current contract assets		194		374		328		435
Accounts receivable, net	$	2,065	$	2,408	$	2,186	$	2,370
Non-current accounts receivable, net	$	23	$	34	$	14	$	23
Non-current contract assets	$	431	$	327	$	569	$	532
Deferred revenue	$	636	$	547	$	646	$	576

During the three ~~and nine~~ months ended ~~September 30, 2021,~~March 31, 2022, revenue of ~~$39~~approximately $251 million ~~and $408 million, respectively,~~ was recognized that was reflected as deferred revenue at December 31, ~~2020.~~ 2021.

During the three months ended ~~September 30, 2021, revenue of $262 million was recognized that was reflected as deferred revenue at June 30, 2021.~~

~~During the three and nine months ended September 30, 2021,~~March 31, 2022, the Company recognized revenue of ~~$16~~approximately $3 million ~~and $62 million, respectively,~~ related to performance obligations satisfied in a prior ~~to 2021.~~period.

Performance Obligations

The Company has contracts for which performance obligations have not been satisfied as of ~~September 30, 2021~~March 31, 2022 or have been partially satisfied as of this date. The following table shows the expected timing for the satisfaction of the remaining performance obligations. This table does not include contract renewals or variable consideration, which was excluded from the transaction prices in accordance with the guidance on constraining estimates of variable consideration.

In addition, in accordance with ASC 606, Revenue From Contracts With Customers (‘ASC 606’), the Company has elected not to disclose the remaining performance obligations when one or both of the following circumstances apply:

•

Performance obligations which are part of a contract that has an original expected duration of less than one year, and

•

Performance obligations satisfied in accordance with ASC 606-10-55-18 (‘right to invoice’).


	Remainder of 2022		2023		2024 onward		Total
Revenue expected to be recognized on contracts as of March 31, 2022	$	476	$	621	$	682	$	1,779

•

~~Performance obligations which are part of a contract that has an original expected duration of less than one year, and~~

•

~~Performance obligations satisfied in accordance with ASC 606-10-55-18 (‘right to invoice’).~~

Remainder of 2021

2022

2023 onward

Total

Revenue expected to be recognized on contracts as of September 30, 2021

$
174

$
546

$
788

$
1,508

Since most of the Company’s contracts are cancellable with less than one year’s notice, and have no substantive penalty for cancellation, the majority of the Company’s remaining performance obligations as of ~~September 30, 2021~~March 31, 2022 have been excluded from the table above.

Note 5 — Segment Information

~~Willis Towers Watson~~WTW has 42 reportable operating segments or business areas:

•

~~Human Capital and Benefits (‘HCB’)~~

•

Health, Wealth & Career (‘HWC’)

•

~~Corporate Risk and Broking (‘CRB’~~•

Risk & Broking (‘R&B’)

•

~~Investment, Risk and Reinsurance (‘IRR’)~~

•

~~Benefits Delivery and Administration (‘BDA’)~~

~~Willis Towers Watson’s~~WTW’s chief operating decision maker is its chief executive officer. We determined that the operational data used by the chief operating decision maker is at the segment level. Management bases strategic goals and decisions on these segments and the data presented below is used to assess the adequacy of strategic decisions and the methods of achieving these strategies and related financial results. Management evaluates the performance of its segments and allocates resources to them based on net operating income on a pre-tax basis.

The Company experiences seasonal fluctuations of its revenue. Revenue is typically higher during the Company’s first and fourth quarters due primarily to the timing of broking-related activities.

~~All periods~~For the disclosures below, the prior-year period presented ~~have~~has been recast to exclude the ~~operating~~ results of Willis Re, which ~~was included within IRR and~~ has been reclassified toas discontinued operations on the Company’s condensed consolidated financial statements (see Note 3 – ~~Divestitures~~Acquisitions and Divestitures).).

The following table presents segment revenue and segment operating income for our reportable segments for the three months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021. The prior year information has been retrospectively adjusted to conform to the current year presentation.


	Three Months Ended March 31,
	HWC				R&B				Total
	2022		2021		2022		2021		2022		2021
Segment revenue	$	1,244	$	1,233	$	891	$	924	$	2,135	$	2,157

Segment operating income	$	257	$	242	$	192	$	203	$	449	$	445

Three Months Ended September 30,

HCB

CRB

IRR

BDA

Total

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

Segment revenue

$
852

$
796

$
697

$
649

$
172

$
220

$
242

$
226

$
1,963

$
1,891

Segment operating
income/(loss)

$
242

$
209

$
114

$
81

$
22

$
20

$
(19
)

$
(11
)

$
359

$
299

The following table presents ~~segment revenue and segment operating income for our reportable segments for the nine months ended September 30, 2021 and 2020.~~

Nine Months Ended September 30,

HCB

CRB

IRR

BDA

Total

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

Segment revenue

$
2,563

$
2,413

$
2,295

$
2,089

$
615

$
716

$
771

$
666

$
6,244

$
5,884

Segment operating
income/(loss)

$
654

$
582

$
457

$
343

$
108

$
108

$
(22
)

$
(31
)

$
1,197

$
1,002

~~The following table presents reconciliations~~a reconciliation of the information reported by segment to the Company’s condensed consolidated ~~statements~~statement of comprehensive income amounts reported for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021.


	Three Months Ended March 31,
	2022			2021
Revenue:
Total segment revenue	$	2,135		$	2,157
Divested businesses		0			51
Reimbursable expenses and other		25			20
Revenue	$	2,160		$	2,228

Total segment operating income	$	449		$	445
Divested businesses		0			(10	)
Impairment (i)		(81	)		0
Amortization		(85	)		(103	)
Restructuring costs		(6	)		0
Transaction and transformation, net (ii)		(20	)		(24	)
Unallocated, net (iii)		(78	)		(97	)
Income from operations		179			211
Interest expense		(49	)		(59	)
Other income, net		27			438
Income from continuing operations before income taxes	$	157		$	590

(i)

Represents the impairment related to the net assets of our Russian business that are held outside of our Russian entities (see Note 3 — Acquisitions and Divestitures for further information).

(ii)

In 2022, in addition to legal fees and other transaction costs, includes consulting fees related to the Transformation program (see Note 6 — Restructuring Costs). In 2021, includes fees related to our then-proposed Aon combination.

(iii)

Includes certain costs, primarily related to corporate functions which are not directly related to the segments, and ~~2020.~~

Three Months Ended
September 30,

Nine Months Ended
September 30,

2021

2020

2021

2020

Revenue:

Total segment revenue

$
1,963

$
1,891

$
6,244

$
5,884

Reimbursable expenses and other

10

6

48

62

Revenue

$
1,973

$
1,897

$
6,292

$
5,946

Total segment operating income

$
359

$
299

$
1,197

$
1,002

Amortization

(85
)

(108
)

(285
)

(347
)
Transaction and integration, net ⁽ⁱ⁾

952

(42
)

877

(65
)
Unallocated, net ⁽ⁱⁱ⁾

(95
)

(83
)

(277
)

(310
)
Income from operations

1,131

66

1,512

280

Interest expense

(50
)

(61
)

(161
)

(184
)
Other income, net

105

156

617

321

INCOME FROM CONTINUING OPERATIONS BEFORE
INCOME TAXES

$
1,186

$
161

$
1,968

$
417

certain differences between budgeted expenses determined at the beginning of the year and actual expenses that we report for U.S. GAAP purposes.

~~(i)~~

Includes mainly transaction costs related to the proposed Aon combination prior to its termination. For the three and nine months ended September 30, 2021, includes the $1 billion income receipt related to the termination of the proposed Aon transaction.

~~(ii)~~

Includes certain costs, primarily related to corporate functions which are not directly related to the segments, and certain differences between budgeted expenses determined at the beginning of the year and actual expenses that we report for U.S. GAAP purposes. Additionally, these costs also include corporate costs that had previously been allocated to Willis Re, due to the reclassification of the Willis Re results as discontinued operations.

The Company does not currently provide asset information by reportable segment as it does not routinely evaluate the total asset position by segment.

Note 6—Restructuring Costs

In the fourth quarter of 2021, the Company initiated a three-year ‘Transformation program’ designed to enhance operations, optimize technology and align its real estate footprint to its new ways of working. The program is expected to generate annual cost savings of approximately $300 million by the end of 2024. The program is expected to include cumulative costs of approximately $490 million and capital expenditures of approximately $260 million, for a total investment of $750 million. The main categories of charges will be in the following four areas:

•

Real estate rationalization — includes costs to align the real estate footprint to the new ways of working (hybrid work) and includes breakage fees and the impairment of right-of-use assets and other related leasehold assets.

•

Technology modernization — these charges are incurred in moving to common platforms and technologies, including migrating certain platforms and applications to the cloud. This category will include the impairment of technology assets that are duplicative or no longer revenue-producing, as well as costs for technology investments that do not qualify for capitalization.

•

Process optimization — these costs will be incurred in the right-shoring strategy and automation of our operations, which will include optimizing resource deployment and appropriate colleague alignment. These costs will include process and organizational design costs, severance and separation-related costs and temporary retention costs.

•

Other — other costs not included above including fees for professional services, other contract terminations not related to the above categories and supplier migration costs.

Certain costs under the Transformation program are accounted for under ASC 420, Exit or Disposal Cost Obligation, and are included as restructuring costs in the condensed consolidated statements of comprehensive income. Other costs incurred under the Transformation program are included in transaction and transformation, net and were $5 million for the three months ended March 31, 2022. An analysis of total restructuring costs incurred under the Transformation program by category and by segment and corporate functions, from commencement to March 31, 2022, is as follows:


	HWC		R&B		Corporate		Total
2021
Real estate rationalization	$	—	$	—	$	19	$	19
Technology modernization		—		5		—		5
Process optimization		—		—		—		—
Other		—		—		2		2
2022
Real estate rationalization		—		—		5		5
Technology modernization		—		—		—		—
Process optimization		1		—		—		1
Other		—		—		—		—
Total
Real estate rationalization		—		—		24		24
Technology modernization		—		5		—		5
Process optimization		1		—		—		1
Other		—		—		2		2
Total	$	1	$	5	$	26	$	32

A rollforward of the liability associated with cash-based charges related to restructuring costs associated with the Transformation program is as follows:


	Real estate rationalization			Technology modernization		Process optimization		Other			Total
Balance at October 1, 2021	$	—		$	—	$	—	$	0		$	0
Charges incurred		—			—		—		2			2
Cash payments		—			—		—		(1	)		(1	)
Balance at December 31, 2021		—			—		—		1			1
Charges incurred		5			—		—		—			5
Cash payments		(5	)		—		—		(1	)		(6	)
Balance at March 31, 2022	$	—		$	—	$	—	$	0		$	0

Note 7 — Income Taxes

Provision for income taxes ~~on continuing operations~~ for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 was ~~$267~~$43 million ~~and $386 million, respectively,~~ compared to ~~$42 million and $133~~$44 million for the three ~~and nine~~ months ended ~~September 30, 2020, respectively.~~March 31, 2021. The effective tax ~~rates were 22.5% and 19.6%~~rate was 27.5% for the three ~~and nine~~ months ended ~~September 30, 2021, respectively,~~March 31, 2022 and ~~26.6% and 31.9%~~7.4% for the three ~~and nine~~ months ended ~~September 30, 2020, respectively.~~March 31, 2021. These effective tax rates are calculated using extended values from our condensed consolidated statements of comprehensive income and are therefore more precise tax rates than can be calculated from rounded values. The ~~current-quarter~~prior year quarter effective tax rate was lower due to the tax-exempt disposal of our Miller business. Additionally, the current quarter effective tax rate includes ~~a $250 million estimated~~the tax ~~expense related to the income receipt~~effect of the termination payment, however the prior-year effective tax rate for the three months ended September 30, 2020 was higher due to an additional deferred tax expense related to the enacted U.K. statutory tax rate change. The prior-year effective tax rate for the nine months ended September 30, 2020 was higher due to additional tax expense recognized in connection with the temporary provisionsdivestment of ~~the Coronavirus Aid, Relief, and Economic Security (‘CARES’) Act.~~ our Russia business.

The amounts above exclude the benefit from income tax attributable to discontinued operations of $3 million and the provision for income tax expense of $70 million for the three and nine months ended September 30, 2021, respectively, as well as the provisions for income tax expense of $4 million and $66 million for the three and nine months ended September 30, 2020, respectively.

The Company recognizes deferred tax balances related to the undistributed earnings of subsidiaries when it expects that it will recover those undistributed earnings in a taxable manner, such as through receipt of dividends or sale of the investments. Historically, we have

not provided taxes on cumulative earnings of our subsidiaries that have been reinvested indefinitely. As a result of our plans to restructure or distribute accumulated earnings of certain foreign operations, we have recorded an estimate of foreign withholding and

state income taxes. In addition, in connection with the Willis Re divestiture, we have recorded an estimated deferred tax expense for certain Willis Re subsidiaries whose outside basis differences are no longer considered indefinitely reinvested. However, we assert that the historical cumulative earnings of our other subsidiaries are reinvested indefinitely, and therefore do not provide deferred tax liabilities on these amounts.

The Company records valuation allowances against net deferred tax assets based on whether it is more likely than not that the deferred tax assets will be realized. We have liabilities for uncertain tax positions under ASC 740 of ~~$45~~$42 million, excluding interest and penalties. The Company believes the outcomes that are reasonably possible within the next 12 months may result in a reduction in the liability for uncertain tax positions of approximately $5$7 million to $9$9 million, excluding interest and penalties.

Note 78 — Goodwill and Other Intangible Assets

The components of goodwill are outlined below for the ~~nine~~three months ended ~~September 30, 2021:~~March 31, 2022. The prior year segment information has been retrospectively adjusted to conform to the current year presentation.

	HCB			CRB			IRR			BDA		Total
Balance at December 31, 2020:
Goodwill, gross ⁽ⁱ⁾	$	4,346		$	2,378		$	882		$	3,278	$	10,884
Accumulated impairment losses		(130	)		(362	)		0			0		(492	)
Goodwill, net - December 31, 2020		4,216			2,016			882			3,278		10,392
Goodwill disposals		0			(7	)		(188	)		0		(195	)
Foreign exchange		(28	)		(25	)		2			0		(51	)
Balance at September 30, 2021:
															HWC			R&B			Total
Balance at December 31, 2021:
Goodwill, gross		4,318			2,346			696			3,278		10,638		$	7,904		$	2,771		$	10,675
Accumulated impairment losses		(130	)		(362	)		0			0		(492	)		(130	)		(362	)		(492	)
Goodwill, net - September 30, 2021	$	4,188		$	1,984		$	696		$	3,278	$	10,146
Goodwill, net - December 31, 2021																7,774			2,409			10,183
Goodwill acquired																0			60			60
Goodwill disposals																0			(18	)		(18	)
Acquisition accounting adjustments																(1	)		(1	)		(2	)
Foreign exchange																(9	)		(14	)		(23	)
Balance at March 31, 2022:
Goodwill, gross																7,894			2,798			10,692
Accumulated impairment losses																(130	)		(362	)		(492	)
Goodwill, net - March 31, 2022															$	7,764		$	2,436		$	10,200

~~(i)~~

Excludes $812 million of goodwill associated with our IRR segment, which has been reclassified as assets held for sale on our condensed consolidated balance sheets at both September 30, 2021 and December 31, 2020 in conjunction with the pending divestiture of our Willis Re business.

Other Intangible Assets

The following table reflects changes in the net carrying amounts of the components of finite-lived intangible assets for the ~~nine~~three months ended ~~September 30, 2021:~~March 31, 2022:

	Client relationships			Software			Trademark and trade name			Other			Total
Balance at December 31, 2020:
																Client relationships			Software			Trademark and trade name			Other			Total
Balance at December 31, 2021:
Intangible assets, gross	$	4,058		$	761		$	1,054		$	103		$	5,976		$	3,794		$	742		$	1,039		$	102		$	5,677
Accumulated amortization		(2,028	)		(659	)		(220	)		(34	)		(2,941	)		(2,118	)		(701	)		(257	)		(46	)		(3,122	)
Intangible assets, net - December 31, 2020 ⁽ⁱ⁾		2,030			102			834			69			3,035
Intangible assets, net - December 31, 2021																	1,676			41			782			56			2,555
Intangible assets acquired																	34			0			0			0			34
Intangible asset disposals		(47	)		0			(8	)		0			(55	)		0			0			0			(5	)		(5	)
Amortization		(193	)		(49	)		(32	)		(11	)		(285	)		(60	)		(10	)		(11	)		(4	)		(85	)
Foreign exchange		(14	)		0			(1	)		1			(14	)		(5	)		0			0			(2	)		(7	)
Balance at September 30, 2021:
Balance at March 31, 2022:
Intangible assets, gross		3,837			742			1,040			104			5,723			3,811			736			1,038			100			5,685
Accumulated amortization		(2,061	)		(689	)		(247	)		(45	)		(3,042	)		(2,166	)		(705	)		(267	)		(55	)		(3,193	)
Intangible assets, net - September 30, 2021	$	1,776		$	53		$	793		$	59		$	2,681
Intangible assets, net - March 31, 2022																$	1,645		$	31		$	771		$	45		$	2,492

~~(i)~~

Excludes $8 million of intangible assets, net, which have been reclassified as assets held for sale on our condensed consolidated balance sheets at both September 30, 2021 and December 31, 2020 in conjunction with the pending divestiture of our Willis Re business.

The weighted-average remaining life of amortizable intangible assets at ~~September 30, 2021~~March 31, 2022 was ~~13.1~~12.8 years.

The table below reflects the future estimated amortization expense for amortizable intangible assets for the remainder of ~~2021~~2022 and for subsequent years:

Amortization

Remainder of 2021

$
84

2022

307

2023

254

2024

223

2025

203

Thereafter

1,610

Total

$
2,681

~~Note 8~~ —


	Amortization
Remainder of 2022	$	228
2023		261
2024		229
2025		207
2026		200
Thereafter		1,367
Total	$	2,492

Note 9—Derivative Financial Instruments

We are exposed to certain foreign currency risks. Where possible, we identify exposures in our business that can be offset internally. Where no natural offset is identified, we may choose to enter into various derivative transactions. These instruments have the effect of reducing our exposure to unfavorable changes in foreign currency rates. The Company’s board of directors reviews and approves policies for managing this risk as summarized below. Additional information regarding our derivative financial instruments can be found in Note 1011 — Fair Value Measurements and Note 1617 — Accumulated Other Comprehensive Loss.

Foreign Currency Risk

Certain non-U.S. subsidiaries receive revenue and incur expenses in currencies other than their functional currency, and as a result, the foreign subsidiary’s functional currency revenue and/or expenses will fluctuate as the currency rates change. Additionally, the forecast Pounds sterling expenses of our London brokerage market operations may exceed their Pounds sterling revenue, and the entity with such operations may also hold significant foreign currency asset or liability positions in the condensed consolidated balance sheet. To reduce such variability, we use foreign exchange contracts to hedge against this currency risk.

These derivatives were designated as hedging instruments and at ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021 had total notional amounts of ~~$129~~$133 million and ~~$340~~$155 million, respectively, and had a net liability fair value of $1 million and a net asset fair ~~values~~value of $3$3 million, ~~and $5 million,~~ respectively. As part of and prior to our disposal of Miller (see Note 3 – Divestitures), and prior to their contract expiration, we closed derivatives designated as hedging instruments with notional values of $27 million that were outstanding at December

At March 31, ~~2020.~~

~~At September 30, 2021,~~2022, the Company estimates, based on current exchange rates, there will be $2$1 million of net derivative ~~gains~~losses on forward exchange rates reclassified from accumulated other comprehensive loss into earnings within the next twelve months as the forecast transactions affect earnings. At ~~September 30, 2021,~~March 31, 2022, our longest outstanding maturity was 1.6 years.

The effects of the material derivative instruments that are designated as hedging instruments on the condensed consolidated statements of comprehensive income for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ are below. Amounts pertaining to the ineffective portion of hedging instruments and those excluded from effectiveness testing were immaterial for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021.

(Loss)/gain recognized in OCL (effective element)

Three months ended September 30,

Nine months ended September 30,

2021

2020

2021

2020

Forward exchange contracts

$
(2
)

$
6

$
3

$
(21
)


Three Months Ended March 31,	(Loss)/gain recognized in OCI (effective element)
	2022			2021
Forward exchange contracts	$	(1	)	$	4


Location of (loss)/gain reclassified from Accumulated OCL into income (effective element)	(Loss)/gain reclassified from Accumulated OCL into income (effective element)
	2022		2021
Revenue	$	0	$	(1	)
Salaries and benefits		2		1
Discontinued operations		0		1
	$	2	$	1

Location of (loss)/gain reclassified from Accumulated OCL into income (effective element)

(Loss)/gain reclassified from Accumulated OCL into income (effective element)

Three months ended September 30,

Nine months ended September 30,

2021

2020

2021

2020

Revenue

$
(1
)

$
(2
)

$
(3
)

$
(4
)
Salaries and benefits

2

(2
)

5

(3
)
Discontinued operations

—

—

3

(1
)

$
1

$
(4
)

$
5

$
(8
)

We also enter into foreign currency transactions, primarily to hedge certain intercompany loans and other balance sheet exposures in currencies other than the functional currency of a given entity. These derivatives are not generally designated as hedging instruments, and at ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, we had notional amounts of ~~$1.9~~$2.6 billion and ~~$1.5~~$2.9 billion, ~~respectively,~~respectively. At March 31, 2022 and December 31, 2021, we had ~~a net liability fair value of $21 million and a~~ net asset fair ~~value~~values of ~~$15~~$9 million and $15 million, respectively.

The effects of derivatives that have not been designated as hedging instruments on the condensed consolidated statements of comprehensive income for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ are as follows:

(Loss)/gain recognized in income

Three Months Ended
September 30,

Nine Months Ended
September 30,

Derivatives not designated as hedging instruments:

Location of (loss)/gain
recognized in income

2021

2020

2021

2020

Forward exchange contracts

Other income, net

$
(7
)

$
5

$
(36
)

$
(15
)

~~Note 9~~ —


		Loss recognized in income
		Three Months Ended March 31,
Derivatives not designated as hedging instruments:	Location of loss recognized in income	2022			2021
Forward exchange contracts	Other income, net	$	(6	)	$	(16	)

Note 10—Debt

Current debt consists of the following:

September 30,
2021

December 31,
2020

Revolving $1.25 billion credit facility ⁽ⁱ⁾

$
—

$
—

5.750% senior notes due 2021

—

500

3.500% senior notes due 2021

—

449

2.125% senior notes due 2022⁽ⁱⁱ⁾

625

—

Current portion of collateralized facility

19

22

$
644

$
971


	March 31, 2022		December 31, 2021
2.125% senior notes due 2022 (i)	$	599	$	613
	$	599	$	613

Long-term debt consists of the following:


	March 31, 2022		December 31, 2021
Revolving $1.5 billion credit facility	$	—	$	—
4.625% senior notes due 2023		249		249
3.600% senior notes due 2024		648		648
4.400% senior notes due 2026		547		546
4.500% senior notes due 2028		597		597
2.950% senior notes due 2029		726		726
6.125% senior notes due 2043		271		271
5.050% senior notes due 2048		395		395
3.875% senior notes due 2049		542		542
	$	3,975	$	3,974

September 30,
2021

December 31,
2020

Revolving $1.25 billion credit facility

$
—

$
—

Collateralized facility ⁽ⁱⁱⁱ⁾

19

33

2.125% senior notes due 2022⁽ⁱⁱ⁾

—

659

4.625% senior notes due 2023

249

249

3.600% senior notes due 2024

648

647

4.400% senior notes due 2026

546

546

4.500% senior notes due 2028

596

596

2.950% senior notes due 2029

727

726

6.125% senior notes due 2043

271

271

5.050% senior notes due 2048

395

395

3.875% senior notes due 2049

542

542

$
3,993

$
4,664

(i)

Notes issued in Euro (€540 million).

~~(i)~~

~~The $1.25 billion revolving credit facility expires on March 7,~~At March 31, 2022 ~~(see Note 18 – Subsequent Event for additional information).~~

~~(ii)~~

~~Notes issued in Euro (€540 million).~~

~~(iii)~~

~~At September 30, 2021 and December 31, 2020, the Company had $82 million and $98 million, respectively, of renewal commissions receivables pledged as collateral for this facility.~~

~~Payments of 3.500% Senior Notes due 2021 and 5.750% Senior Notes due 2021~~

~~In August 2021, the Company called the $450 million 3.500% senior notes due to mature in September 2021. The Company repaid the principal and interest in August 2021 using cash on-hand.~~

~~In March 2021, the $500 million 5.750% senior notes matured. The principal and interest were repaid by the Company using cash on-hand.~~

~~At September 30, 2021~~ and December 31, ~~2020~~2021, we were in compliance with all financial covenants.

Note 1011 — Fair Value Measurements

The Company has categorized its assets and liabilities that are measured at fair value on a recurring and non-recurring basis into a three-level fair value hierarchy, based on the reliability of the inputs used to determine fair value as follows:

•

Level 1: refers to fair values determined based on quoted market prices in active markets for identical assets;

•

Level 2: refers to fair values estimated using observable market-based inputs or unobservable inputs that are corroborated by market data; and

•

Level 3: includes fair values estimated using unobservable inputs that are not corroborated by market data.

•

~~Level 1: refers to fair values determined based on quoted market prices in active markets for identical assets;~~

•

~~Level 2: refers to fair values estimated using observable market-based inputs or unobservable inputs that are corroborated by market data; and~~

•

~~Level 3: includes fair values estimated using unobservable inputs that are not corroborated by market data.~~

The following methods and assumptions were used by the Company in estimating its fair value disclosure for financial instruments:

•

Available-for-sale securities are classified as Level 1 because we use quoted market prices in determining the fair value of these securities.

•

Market values for our derivative instruments have been used to determine the fair value of forward foreign exchange contracts based on estimated amounts the Company would receive or have to pay to terminate the agreements, taking into account observable information about the current foreign currency forward rates. Such financial instruments are classified as Level 2 in the fair value hierarchy.

•

Contingent consideration payable is classified as Level 3, and we estimate fair value based on the likelihood and timing of achieving the relevant milestones of each arrangement, applying a probability assessment to each of the potential outcomes, which at times includes the use of a Monte Carlo simulation, and discounting the probability-weighted payout. Typically, milestones are based on revenue or earnings growth for the acquired business.

•

~~Available-for-sale securities are classified as Level 1 because we use quoted market prices in determining the fair value of these securities.~~

•

The following tables present our assets and liabilities measured at fair value on a recurring basis at ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020:~~2021:


		Fair Value Measurements on a Recurring Basis at March 31, 2022
	Balance Sheet Location	Level 1		Level 2		Level 3		Total
Assets:
Available-for-sale securities:
Mutual funds / exchange traded funds	Prepaid and other current assets and other non-current assets	$	8	$	0	$	0	$	8
	Fiduciary assets		151		0		0		151
Derivatives:
Derivative financial instruments (i)	Prepaid and other current assets and other non-current assets	$	0	$	10	$	0	$	10
Liabilities:
Contingent consideration:
Contingent consideration (ii)	Other current liabilities and other non-current liabilities	$	0	$	0	$	50	$	50
Derivatives:
Derivative financial instruments (i)	Other current liabilities and other non-current liabilities	$	0	$	2	$	0	$	2


		Fair Value Measurements on a Recurring Basis at December 31, 2021
	Balance Sheet Location	Level 1		Level 2		Level 3		Total
Assets:
Available-for-sale securities:
Mutual funds / exchange traded funds	Prepaid and other current assets and other non-current assets	$	9	$	0	$	0	$	9
	Fiduciary assets		152		0		0		152
Certificates of deposit/term deposits	Prepaid and other current assets and other non-current assets		200		0		0		200
Derivatives:
Derivative financial instruments (i)	Prepaid and other current assets and other non-current assets	$	0	$	18	$	0	$	18
Liabilities:
Contingent consideration:
Contingent consideration (ii)	Other current liabilities and other non-current liabilities	$	0	$	0	$	51	$	51
Derivatives:
Derivative financial instruments (i)	Other current liabilities and other non-current liabilities	$	0	$	0	$	0	$	0

Fair Value Measurements on a Recurring Basis at
September 30, 2021

Balance Sheet Location

Level 1

Level 2

Level 3

Total

Assets:

Available-for-sale securities:

Mutual funds / exchange traded funds

Prepaid and other current assets and other non-current assets

$
9

$
0

$
0

$
9

Derivatives:

Derivative financial instruments ⁽ⁱ⁾

Prepaid and other current assets and other non-current assets

$
0

$
4

$
0

$
4

Liabilities:

Contingent consideration:

Contingent consideration ⁽ⁱⁱ⁾

Other current liabilities and other non-current liabilities

$
0

$
0

$
30

$
30

Derivatives:

Derivative financial instruments ⁽ⁱ⁾

Other current liabilities and other non-current liabilities

$
0

$
22

$
0

$
22

(i)

See Note 9 — Derivative Financial Instruments for further information on our derivative investments.

Fair Value Measurements on a Recurring Basis at
December 31, 2020

Balance Sheet Location

Level 1

Level 2

Level 3

Total

Assets:

Available-for-sale securities:

Mutual funds / exchange traded funds

Prepaid and other current assets and other non-current assets

$
8

$
0

$
0

$
8

Derivatives:

Derivative financial instruments ⁽ⁱ⁾

Prepaid and other current assets and other non-current assets

$
0

$
27

$
0

$
27

Liabilities:

Contingent consideration:

Contingent consideration ⁽ⁱⁱ⁾

Other current liabilities and other non-current liabilities

$
0

$
0

$
45

$
45

Derivatives:

Derivative financial instruments ⁽ⁱ⁾

Other current liabilities and other non-current liabilities

$
0

$
7

$
0

$
7

(ii)

Probability weightings are based on our knowledge of the past and planned performance of the acquired entity to which the contingent consideration applies. The fair value weighted-average discount rates used in our material contingent consideration calculations were 11.87% and 11.92% at March 31, 2022 and December 31, 2021, respectively. The range of these discount rates was 3.53% - 13.80% at March 31, 2022. Using different probability weightings and discount rates could result in an increase or decrease of the contingent consideration payable.

~~(i)~~

~~See Note 8 — Derivative Financial Instruments for further information on our derivative investments.~~

~~(ii)~~

Probability weightings are based on our knowledge of the past and planned performance of the acquired entity to which the contingent consideration applies. The fair value weighted-average discount rates used in our material contingent consideration calculations were 11.01% and 9.46% at September 30, 2021 and December 31, 2020, respectively. The range of these discount rates was 3.53% - 13.00% at September 30, 2021. Using different probability weightings and discount rates could result in an increase or decrease of the contingent consideration payable.

The following table summarizes the change in fair value of the Level 3 liabilities:


Fair Value Measurements Using Significant Unobservable Inputs (Level 3)	March 31, 2022
Balance at December 31, 2021	$	51
Obligations assumed		15
Payments		(20	)
Realized and unrealized losses (i)		3
Foreign exchange		1
Balance at March 31, 2022	$	50

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)

September 30, 2021

Balance at December 31, 2020

$
45

Obligations assumed

0

Payments

(19
)
Realized and unrealized gains

5

Foreign exchange

(1
)
Balance at September 30, 2021

$
30

(i)

Realized and unrealized losses include accretion and adjustments to contingent consideration liabilities, which are included within Interest expense and Other operating expenses, respectively, on the condensed consolidated statements of comprehensive income.

There were 0 significant transfers to or from Level 3 in the ~~nine~~three months ended ~~September 30, 2021.~~March 31, 2022.

Fair value information about financial instruments not measured at fair value

The following tables present our ~~assets and~~ liabilities not measured at fair value on a recurring basis at ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020:~~2021:


	September 30, 2021				December 31, 2020				March 31, 2022				December 31, 2021
	Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value
Assets:
Long-term note receivable	$	70	$	72	$	71	$	73	$	68	$	68	$	69	$	70
Liabilities:
Current debt	$	644	$	651	$	971	$	985	$	599	$	600	$	613	$	616
Long-term debt	$	3,993	$	4,560	$	4,664	$	5,488	$	3,975	$	4,026	$	3,974	$	4,453

The carrying ~~values~~value of our revolving credit facility ~~and collateralized facility approximate their~~approximates its fair ~~values.~~value. The fair values above, which exclude accrued interest, are not necessarily indicative of the amounts that the Company would realize upon disposition, nor do they indicate the Company’s intent or ability to dispose of the financial instruments. The fair values of our respective senior notes and long-term note receivable are considered Level 2 financial instruments as they are corroborated by observable market data.

Note 1112 — Retirement Benefits

Defined Benefit Plans and Post-retirement Welfare Plans

~~Willis Towers Watson~~WTW sponsors both qualified and non-qualified defined benefit pension plans and other post-retirement welfare (‘PRW’) plans throughout the world. The majority of our plan assets and obligations are in the U.S. and the U.K. We have also included disclosures related to defined benefit plans in certain other countries, including Canada, France, Germany, Switzerland and Ireland. Together, these disclosed funded and unfunded plans represent ~~99%~~99% of ~~Willis Towers Watson’s~~WTW’s pension and PRW obligations and are disclosed herein.

Components of Net Periodic Benefit (Income)/Cost for Defined Benefit Pension and Post-retirement Welfare Plans

The following ~~tables set~~table sets forth the components of net periodic benefit (income)/cost for the Company’s defined benefit pension and PRW plans for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020:~~2021:


	Three Months Ended September 30,																								Three Months Ended March 31,
	2021												2020												2022												2021
	U.S.			U.K.			Other			PRW			U.S.			U.K.			Other			PRW			U.S.			U.K.			Other			PRW			U.S.			U.K.			Other			PRW
Service cost	$	19		$	4		$	6		$	0		$	18		$	4		$	5		$	0		$	19		$	3		$	6		$	0		$	20		$	4		$	6		$	0
Interest cost		24			14			3			0			32			18			4			1			29			19			4			1			23			14			3			0
Expected return on plan assets		(79	)		(42	)		(9	)		0			(73	)		(63	)		(8	)		0			(83	)		(39	)		(10	)		0			(77	)		(43	)		(9	)		0
Settlement		0			1			2			0			0			0			0			0			0			0			0			0			1			0			0			0
Amortization of net loss		8			7			1			1			9			6			0			0			4			8			1			0			11			7			1			0
Amortization of prior service credit		0			(4	)		1			(1	)		0			(4	)		0			(1	)		0			(3	)		0			(1	)		0			(4	)		0			(1	)
Net periodic benefit (income)/cost	$	(28	)	$	(20	)	$	4		$	0		$	(14	)	$	(39	)	$	1		$	0		$	(31	)	$	(12	)	$	1		$	0		$	(22	)	$	(22	)	$	1		$	(1	)

Nine Months Ended September 30,

2021

2020

U.S.

U.K.

Other

PRW

U.S.

U.K.

Other

PRW

Service cost

$
59

$
13

$
18

$
0

$
54

$
11

$
15

$
0

Interest cost

71

42

9

1

98

54

11

2

Expected return on plan assets

(233
)

(128
)

(28
)

0

(218
)

(184
)

(25
)

0

Settlement

1

2

2

0

2

1

0

0

Amortization of net loss

30

21

4

2

26

17

2

1

Amortization of prior service credit

0

(13
)

1

(3
)

0

(12
)

0

(3
)
Net periodic benefit (income)/cost

$
(72
)

$
(63
)

$
6

$
0

$
(38
)

$
(113
)

$
3

$
0

~~Amounts related to discontinued operations in the tables above were not material during the three and nine months ended September 30, 2021 and 2020.~~

Employer Contributions to Defined Benefit Pension Plans

The Company ~~made $60 million of~~did 0t make any contributions to its U.S. plans ~~for~~during the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 and currently does 0t0t anticipate making ~~any additional~~ contributions over the remainder of the fiscal year. The Company made contributions of ~~$28~~$8 million to its U.K. plans for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 and anticipates making additional contributions of ~~$14~~$31 million for the remainder of the fiscal year. The Company made contributions of ~~$22~~$14 million to its other plans for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 and anticipates making additional contributions of $3$11 million for the remainder of the fiscal year.

Defined Contribution Plans

The Company made contributions to its defined contribution plans of ~~$36~~$42 million and ~~$118~~$43 million during the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021, ~~respectively, and $39 million and $122 million during the three and nine months ended September 30, 2020,~~ respectively.

Note 13 —Leases

The following ~~tables present~~table presents lease costs recorded on our condensed consolidated statements of comprehensive income for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021:


	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended March 31,
	2021			2020			2021			2020			2022			2021
Finance lease cost:
Amortization of right-of-use assets	$	—		$	1		$	1		$	2
Interest on lease liabilities		1			—			2			2		$	1		$	1
Operating lease cost		43			45			134			138			39			46
Short-term lease cost		—			1			1			1
Variable lease cost		13			14			39			37			18			13
Sublease income		(6	)		(6	)		(16	)		(16	)		(4	)		(5	)
Total lease cost, net	$	51		$	55		$	161		$	164		$	54		$	55

~~Amounts related to discontinued operations in the tables above were not material during the three and nine months ended September 30, 2021 and 2020.~~

The total lease cost is recognized in different locations in our condensed consolidated statements of comprehensive income. Amortization of the finance lease ROU assets is included in depreciation, while the interest cost component of these finance leases is included in interest expense. All other costs are included in other operating ~~expenses.~~

expenses, with the exception of $5 million that was included in restructuring costs (see Note 136 — Restructuring Costs) that primarily related to the payment of early termination fees. There are no significant lease costs that have been included as discontinued operations in the condensed consolidated statements of comprehensive income during the three months ended March 31, 2022 and 2021.

September 30,
2021

December 31,
2020

Dividends payable

$
114

$
103

Income and other taxes payable

333

96

Interest payable

22

68

Deferred compensation plan liabilities

39

51

Contingent and deferred consideration on acquisitions

17

39

Payroll-related liabilities

263

264

Derivatives

22

5

Third-party commissions

87

95

Other current liabilities

53

72

Total other current liabilities

$
950

$
793

September 30,
2021

December 31,
2020

Claims, lawsuits and other proceedings

$
335

$
325

Other provisions

66

81

Total provision for liabilities

$
401

$
406

Other income, net consists of the following:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2021		2020			2021		2020		Three Months Ended March 31,
Gain on disposal of operations	$	23	$	85		$	380	$	83
										2022			2021
(Loss)/gain on disposal of operations										$	(54	)	$	359
Net periodic pension and postretirement benefit credits		79		76			227		227		71			76
Interest in earnings of associates and other investments		1		(1	)		5		4		2			2
Foreign exchange gain/(loss)		1		(2	)		4		7
Foreign exchange gain											6			1
Other		1		(2	)		1		—		2			0
Other income, net	$	105	$	156		$	617	$	321	$	27		$	438

Certain ~~prior~~prior-year period amounts within the ~~tables~~table above have been reclassified to discontinued operations within the condensed consolidated statements of income.

Note 1617 — Accumulated Other Comprehensive Loss

Changes in accumulated other comprehensive loss, net of non-controlling interests, and net of tax are provided in the following tables for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021. These tables exclude amounts attributable to non-controlling interests, which are not material for further disclosure.


	Foreign currency translation (i)						Derivative instruments (i)						Defined pension and post-retirement benefit costs (ii)						Total
	2022			2021			2022			2021			2022			2021			2022			2021
Balance at December 31, 2021 and 2020, respectively	$	(489	)	$	(400	)	$	11		$	9		$	(1,708	)	$	(1,968	)	$	(2,186	)	$	(2,359	)
Other comprehensive (loss)/income before reclassifications		(59	)		(42	)		(1	)		7			2			1			(58	)		(34	)
Gain/(loss) reclassified from accumulated other comprehensive loss (net of income tax benefit of $3 and $6, respectively) (iii)		0			44			(2	)		(1	)		4			39			2			82
Net current-period other comprehensive (loss)/income		(59	)		2			(3	)		6			6			40			(56	)		48
Balance at March 31, 2022 and 2021, respectively	$	(548	)	$	(398	)	$	8		$	15		$	(1,702	)	$	(1,928	)	$	(2,242	)	$	(2,311	)

Foreign currency
translation ⁽ⁱ⁾

Derivative
instruments⁽ⁱ⁾

Defined pension and
post-retirement
benefit costs ⁽ⁱⁱ⁾

Total

2021

2020

2021

2020

2021

2020

2021

2020

Quarter-to-date activity:

Balance at June 30, 2021 and 2020, respectively

$
(376
)

$
(698
)

$
13

$
(6
)

$
(1,915
)

$
(1,686
)

$
(2,278
)

$
(2,390
)
Other comprehensive (loss)/income before
   reclassifications

(81
)

119

(1
)

5

2

0

(80
)

124

(Gain)/loss reclassified from accumulated other
   comprehensive loss (net of income tax benefit of
   $8 and $2, respectively)

0

0

(1
)

4

0

9

(1
)

13

Net current-period other comprehensive (loss)/income

(81
)

119

(2
)

9

2

9

(81
)

137

Balance at September 30, 2021 and 2020, respectively

$
(457
)

$
(579
)

$
11

$
3

$
(1,913
)

$
(1,677
)

$
(2,359
)

$
(2,253
)

Year-to-date activity:

Balance at December 31, 2020 and 2019, respectively

$
(400
)

$
(538
)

$
9

$
13

$
(1,968
)

$
(1,702
)

$
(2,359
)

$
(2,227
)
Other comprehensive (loss)/income before
   reclassifications

(101
)

(41
)

7

(17
)

2

2

(92
)

(56
)
Loss/(gain) reclassified from accumulated other
   comprehensive loss (net of income tax benefit of
   $15 and $9, respectively) ⁽ⁱⁱⁱ⁾

44

0

(5
)

7

53

23

92

30

Net current-period other comprehensive (loss)/income

(57
)

(41
)

2

(10
)

55

25

0

(26
)
Balance at September 30, 2021 and 2020, respectively

$
(457
)

$
(579
)

$
11

$
3

$
(1,913
)

$
(1,677
)

$
(2,359
)

$
(2,253
)
(i)

Reclassification adjustments from accumulated other comprehensive loss related to derivative instruments are included in Revenue and Salaries and benefits in the accompanying condensed consolidated statements of comprehensive income. See Note 9 — Derivative Financial Instruments for additional details regarding the reclassification adjustments for the derivative settlements.

~~(i)~~

Reclassification adjustments from accumulated other comprehensive loss related to derivative instruments are included in Revenue and Salaries and benefits in the accompanying condensed consolidated statements of comprehensive income. See Note 8 — Derivative Financial Instruments for additional details regarding the reclassification adjustments for the derivative settlements.

~~(ii)~~

Reclassification adjustments from accumulated other comprehensive loss are included in the computation of net periodic pension cost (see Note 11 — Retirement Benefits). These components are included in Other income, net in the accompanying condensed consolidated statements of comprehensive income.

(ii)

Reclassification adjustments from accumulated other comprehensive loss are included in the computation of net periodic pension cost (see Note 12 — Retirement Benefits). These components are included in Other income, net in the accompanying condensed consolidated statements of comprehensive income.

(iii)

Includes reclassifications in 2021 of $44 million and $31~~(iii)~~

~~Includes reclassifications of $44 million and $31~~ million of foreign currency translation and defined pension and post-retirement benefit costs, respectively, attributable to the gain on disposal of our Miller business (see ~~Note 3 — Divestitures). The net gain on disposal is included in Other income, net in the accompanying condensed consolidated statements of comprehensive income.~~

Note 173 — Acquisitions and Divestitures). The net gain on disposal is included in Other income, net in the accompanying condensed consolidated statements of comprehensive income.

Note 18 — Earnings Per Share

Basic and diluted earnings per share from continuing operations attributable to ~~Willis Towers Watson~~WTW and discontinued operations, net of tax are calculated by dividing net income from continuing operations attributable to ~~Willis Towers Watson~~WTW and discontinued operations, net of tax, respectively, by the average number of ordinary shares outstanding during each period. The computation of diluted earnings per share reflects the potential dilution that could occur if dilutive securities and other contracts to issue shares were exercised or converted into shares or resulted in the issuance of shares that then shared in the net income of the Company.

At ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ there were ~~0.6~~0.1 million and ~~0.4~~0.3 million performance-based options, respectively, and 0.5 million restricted performance-based stock units outstanding ~~respectively, and 0.1~~at each period presented. At March 31, 2022, there were 0.4 million ~~and 0.3~~restricted time-based stock units outstanding; restricted time-based stock units were immaterial at March 31, 2021. The Company’s time-based share options were immaterial at March 31, 2022; there were 0.1 million time-based share options outstanding ~~respectively. Additionally,~~ at ~~September 30, 2021 and 2020, there were 0.3 million performance-based options outstanding, and the Company’s restricted time-based stock units were immaterial.~~March 31, 2021.

Basic and diluted earnings per share ~~from continuing operations attributable to Willis Towers Watson and discontinued operations~~ are as follows:

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020

Income from continuing operations

$
919

$
119

$
1,582

$
284

    Less: Income attributable to non-controlling interests

(4
)

(1
)

(9
)

(17
)
Income from continuing operations attributable to Willis Towers
   Watson

$
915

$
118

$
1,573

$
267

(Loss)/income from discontinued operations, net of tax

$
(12
)

$
3

$
247

$
253

Basic average number of shares outstanding

129

130

130

130

Dilutive effect of potentially issuable shares

0

0

0

0

Diluted average number of shares outstanding

129

130

130

130

Basic earnings per share from continuing operations attributable
   to Willis Towers Watson

$
7.10

$
0.91

$
12.14

$
2.06

Dilutive effect of potentially issuable shares

(0.02
)

0

(0.04
)

(0.01
)
Diluted earnings per share from continuing operations
   attributable to Willis Towers Watson

$
7.08

$
0.91

$
12.10

$
2.05

Basic (loss)/earnings per share from discontinued operations,
   net of tax

$
(0.09
)

$
0.02

$
1.90

$
1.95

Dilutive effect of potentially issuable shares

0

0

0

(0.01
)
Diluted (loss)/earnings per share from discontinued operations,
   net of tax

$
(0.09
)

$
0.02

$
1.90

$
1.94


	Three Months Ended March 31,
	2022			2021
Income from continuing operations	$	114		$	546
Less: income attributable to non-controllable interests		(3	)		(3	)
Income from continuing operations attributable to WTW	$	111		$	543

Income from discontinued operations, net of tax	$	11		$	190

Basic average number of shares outstanding		118			130
Dilutive effect of potentially issuable shares		0			0
Diluted average number of shares outstanding		118			130

Basic earnings per share from continuing operations attributable to WTW	$	0.94		$	4.18
Dilutive effect of potentially issuable shares		0			(0.01	)
Diluted earnings per share from continuing operations attributable to WTW	$	0.94		$	4.17

Basic earnings per share from discontinued operations, net of tax	$	0.09		$	1.46
Dilutive effect of potentially issuable shares		0			0
Diluted earnings per share from discontinued operations, net of tax	$	0.09		$	1.46

For the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021, ~~0.4~~0.1 million and ~~0.3~~0.2 million restricted stock units ~~respectively,~~ were not included in the computation of the dilutive effect of potentially issuable shares because their effect was ~~anti-dilutive; there were 0 anti-dilutive restricted stock units for the three and nine months ended September 30, 2020.~~anti-dilutive. There were 0 anti-dilutive options for the three ~~and nine~~ months ended ~~September 30,~~ ~~2021~~March 31, 2022 and ~~2020.~~2021.

Note 19 — Supplemental Disclosures of Cash Flow Information

Supplemental disclosures regarding cash flow information are as follows:


	Three months ended March 31,
	2022			2021
Supplemental disclosures of cash flow information:
Cash and cash equivalents	$	2,198		$	1,960
Fiduciary funds (included in fiduciary assets)		2,967			3,744
Cash and cash equivalents and fiduciary funds (included in current assets held for sale)		7			0
Other restricted cash (included in prepaids and other current assets)		0			6
Total cash, cash equivalents and restricted cash	$	5,172		$	5,710

Decrease in cash, cash equivalents and other restricted cash	$	(2,274	)	$	(116	)
Decrease in fiduciary funds		(211	)		(415	)
Total	$	(2,485	)	$	(531	)

~~Note 18 — Subsequent Event~~

~~On October 6,~~Revision of previously issued financial statements - During the three months ended March 31, 2022, to reflect the guidance on restricted cash presentation in FASB ASC 230, Statement of Cash Flows, WTW corrected the classification of its fiduciary funds balances, in the amounts shown in the table above, on our condensed consolidated statements of cash flows, by including these amounts in the total cash, cash equivalents and restricted cash amounts held at each balance sheet date. As a result, cash, cash equivalents and restricted cash balances of $2.0 billion and $2.1 billion at March 31, 2021 ~~Trinity Acquisition plc entered into a second amended~~ and ~~restated revolving credit facility (the ‘new RCF’) for $1.5~~December 31, 2020, respectively, have been revised to $5.7 billion ~~that will mature~~and $6.3 billion, respectively. Additionally, the effect of exchange rate changes on ~~October 6, 2026. This new RCF replaces~~cash, cash equivalents and restricted cash has been updated to include the ~~previous $1.25 billion revolving credit facility which was due to expire in~~ ~~March~~effect of ~~2022~~.

Borrowing costs under the $1.5 billion facility differ if the borrowing is a ‘base rate’ borrowing or a ‘Eurocurrency’ borrowing, both as defined by the new RCF, and equal the sum of the relevant benchmark plus a margin basedexchange rate changes on the ~~Company’s senior unsecured long-term debt rating:~~fiduciary funds balances.

Prior to this correction, the changes in fiduciary funds were presented in fiduciary assets and liabilities on a gross basis in the cash flows from operating activities, where the amounts fully offset each period. In the current presentation, an additional line item, net (payments)/proceeds from fiduciary funds held for clients, has been included within cash flows from financing activities to represent the change in fiduciary funds balances during the periods. The remaining fiduciary assets and fiduciary liabilities, in equal and offsetting amounts, are no longer presented in the cash flows from operating activities. There was no impact to the total cash flows from operating activities as a result of these changes.

•

For base rate borrowings, the benchmark rate will be the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 0.50%, and (c) the one-month LIBOR rate plus 1.0%. The margin on the base rate benchmark is 0.00% to 0.75% depending on the Company’s senior unsecured long-term debt rating.

•

For Eurocurrency or Sterling Overnight Interbank Average Rate (‘SONIA’) borrowings, the rate will be the applicable LIBOR rate or SONIA (as applicable based on the currency of the borrower) plus a margin of 1.0% to 1.75% depending on the Company’s guaranteed unsecured long-term debt rating. In anticipation of the cessation of LIBOR, the new RCF provides for a benchmark rate adjustment that will be added to the replacement benchmark rate to reflect the differential between LIBOR and the replacement benchmark (e.g., the ~~Secured Overnight Financing Rate). This adjustment amount will be a function of both the currency and borrowing tenor.~~

~~The new RCF also carries a commitment (unused) fees of 0.09% to 0.25%, which is also based on the Company’s senior unsecured long-term debt rating.~~

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This discussion includes forward-looking statements. See ‘Disclaimer Regarding Forward-looking Statements’ for certain cautionary information regarding forward-looking statements and a list of factors that could cause actual results to differ materially from those predicted in those statements.

This discussion includes references to non-GAAP financial measures as defined in the rules of the SEC. We present such non-GAAP financial measures, specifically, adjusted, constant currency and organic non-GAAP financial measures, as we believe such information is of interest to the investment community because it provides additional meaningful methods of evaluating certain aspects of the Company’s operating performance from period to period on a basis that may not be otherwise apparent under U.S. GAAP, and these provide a measure against which our businesses may be assessed in the future.

See ‘Non-GAAP Financial Measures’ below for further discussion of our adjusted, constant currency and organic non-GAAP financial measures.

Executive Overview

~~Termination of Proposed Combination with Aon plc~~

On March 9, 2020, WTW and Aon plc (‘Aon’) issued an announcement disclosing that the respective boards of directors of WTW and Aon had reached agreement on the terms of a recommended acquisition of WTW by Aon. Under the terms of the agreement each WTW shareholder would receive 1.08 Aon ordinary shares for each WTW ordinary share. At the time of the announcement, it was estimated that upon completion of the combination, existing Aon shareholders would own approximately 63% and existing WTW shareholders would own approximately 37% of the combined company on a fully diluted basis.

The transaction was approved by the shareholders of both WTW and Aon during meetings of the respective shareholders held on August 26, 2020. On June 16, 2021, the U.S. Department of Justice filed suit in U.S. District Court in the District of Columbia against WTW and Aon, seeking to enjoin the proposed business combination between the two companies (among other relief). On July 26, 2021, WTW and Aon announced they had terminated the business combination agreement and that Aon had agreed to pay WTW $1 billion, in connection with such termination, which was received by WTW on July 27, 2021. The $1 billion income receipt has been included in transaction and integration, net in the condensed consolidated statements of operations. See Note 1 – Nature of Operations in Part I, Item 1 ‘Financial Statements’ in this Form 10-Q for additional information.

~~2022 Business Organization~~

During the third quarter of 2021, the Company announced its intention to align under two segments effective January 1, 2022. These changes are being made in conjunction with changes in the WTW leadership team, including the appointment of a new chief executive officer who will be the chief operating decision maker on that date. In 2022, the two new segments will be Health, Wealth and Career (‘HWC’) and Risk and Broking (‘RB’). The HWC segment will include businesses currently aligned under the Human Capital and Benefits segment, the Benefits Delivery and Administration segment, and the Investment business, currently under the Investment, Risk and Reinsurance segment. The RB segment will include businesses currently aligned under the Corporate Risk and Broking segment, as well as the Insurance Consulting and Technology business, currently under the Investment, Risk and Reinsurance segment.

Market Conditions

Typically, our business benefits from regulatory change, political risk or economic uncertainty. Insurance broking generally tracks the economy, but demand for both insurance broking and consulting services usually remains steady during times of uncertainty. We have some businesses, such as our health and benefits and administration businesses, which can be counter cyclical during the early period of a significant economic change.

Within our insurance and brokerage business, due to the cyclical nature of the insurance market and the impact of other market conditions on insurance premiums, commission revenue may vary widely between accounting periods. A period of low or declining premium rates, generally known as a ‘soft’ or ‘softening’ market, generally leads to downward pressure on commission revenue and can have a material adverse impact on our revenue and operating margin. A ‘hard’ or ‘firming’ market, during which premium rates rise, generally has a favorable impact on our revenue and operating margin. Rates, however, vary by geography, industry and client segment. As a result, and due to the global and diverse nature of our business, we view rates in the aggregate. Overall, we are currently seeing a modest but definite ~~improvement with~~increase in pricing in the market.

Market conditions in the broking industry in which we operate are generally defined by factors such as the strength of the economies in the various geographic regions in which we serve around the world, insurance rate movements, and insurance and reinsurance buying patterns of our clients.

The markets for our consulting, technology and solutions, and marketplace services are affected by economic, regulatory and legislative changes, technological developments, and increased competition from established and new competitors. We believe that the primary factors in selecting a human resources or risk management consulting firm include reputation, the ability to provide measurable increases to shareholder value and return on investment, global scale, quality of service and the ability to tailor services to clients’ unique needs. In that regard, we are focused on developing and implementing technology, data and analytic solutions for both internal operations and for maintaining industry standards and meeting client preferences. We have made such investments from time to time and may decide, based on perceived business needs, to make investments in the future that may be ~~greater than~~different from past practice or what we currently anticipate. Conversely, particularly given the impact of the COVID-19 pandemic, we may make fewer information technology-based investments than previously anticipated, which could potentially create business operational risk.

With regard to the market for exchanges, we believe that clients base their decisions on a variety of factors that include the ability of the provider to deliver measurable cost savings for clients, a strong reputation for efficient execution and an innovative service delivery model and platform. Part of the employer-sponsored insurance market has matured and become more fragmented while other segments remain in the entry phase. As these market segments continue to evolve, we may experience growth in intervals, with periods of accelerated expansion balanced by periods of modest growth. In recent years, growth in the market for exchanges has slowed, and we expect this trend may continue.

From time to time, including but not limited to the period ~~that followed~~after the announcement of the proposed Aon combination through the period that has followed the termination of the proposed combination, we have lost (and may in the future continue to lose) colleagues who manage substantial client relationships or possess substantial experience or expertise; when we lose colleagues such as those, it often results in such colleagues competing against us. Further, the full impact of this competition may be delayed due to the timing of restrictive covenants or client renewals. We ~~expect~~believe that this dynamic,which was most pronounced in our ~~Corporate~~ Risk ~~and~~& Broking segment ~~in the second and third quarters of~~during 2021, ~~may cause~~has caused the segment’s recent near-term and expected growth rates for the remainder of 2022 to ~~steer towards the lower end of the range of industry-expected averages (that is, around mid-single digit growth~~).be meaningfully slower than other competitors. This dynamic may be difficult to predict, given that the adverse impact in future periods is more significant than in the ~~current period,~~periods in which employees departed. Growth has been and itwill be adversely affected by the fact that 2021 performance in a number of businesses, particularly commercial risk broking and health & benefits broking, benefited from revenue

from book sales, which is non-repeatable revenue. It is possible that growth could be different than expected and our results of operations could be significantly and adversely impacted.

See Part I, Item 1A ‘Risk Factors’ in our Annual Report on Form 10-K, filed with the SEC on February ~~23, 2021,~~24, 2022, for a discussion of risks that may affect our ability to compete.

~~Brexit~~

~~Following the occurrence~~As we previously reported, we intend to transfer ownership of ~~Brexit and the end~~our Russian subsidiary to our local management team. The Russian entity comprised approximately 1% of ~~the formal transition period on December 31, 2020,~~consolidated WTW revenue for 2021, primarily within our Risk & Broking segment. The lost profits from our Russia operations will, overall, create a ~~trade agreement has been established between the U.K. and E.U. As expected, the agreement largely addresses goods and not services, and~~modest margin headwind for the Company ~~has therefore completed~~in 2022 and beyond. However, with the ~~establishment~~goal of ~~appropriate arrangements~~offsetting this, we have taken action to deploy near-term cost-mitigation measures and to identify longer-term offsets. See ‘Disclaimer Regarding Forward-looking Statements’ and Part II, Item 1A ‘Risk Factors’ of this Quarterly Report on Form 10-Q for ~~the continued servicing of client business in all relevant E.U. countries. Further negotiations between the U.K. and E.U. resulted in the agreement of~~ a Memorandum of Understanding to address matters related to financial services, though the outcome of future engagement between the U.K. and E.U. in relation to services, including financial services and potential impact on the Company, are not yet fully known. For a further discussion of the risks ~~of Brexit to the Company, see Part I, Item 1A ‘Risk Factors’ in our Annual Report on Form 10-K, filed~~associated with ~~the SEC on February 23, 2021.~~expense actions.

On an annual basis for 2021, although we expect that approximately 18% of our revenue from continuing operations will be generated in the U.K., we expect that approximately 12% of revenue from continuing operations will be denominated in Pounds sterling, as much of the insurance business is transacted in U.S. dollars. We expect that approximately 18% of our expenses from continuing operations will be denominated in Pounds sterling. We have a Company hedging strategy for this aspect of our business, which is designed to mitigate significant fluctuations in currency.

Risks and Uncertainties of the ~~COVID-19 Pandemic and the Related~~ Economic Environment Caused by the Pandemic

Supply and labor market disruptions caused by COVID-19 as well as other factors, such as accommodative monetary and fiscal policy and the Russian invasion of Ukraine, have contributed to significant inflation in many of the markets in which we operate. This impacts not only the costs to attract and retain employees but also other costs to run and invest in our business. If our costs grow significantly in excess of our ability to raise revenue, our margins and results of operations may be materially and adversely impacted, and we may not be able to achieve our strategic and financial objectives.

Segment Reorganization

On January 1, 2022, WTW realigned to provide its comprehensive offering of services and solutions to clients across two business segments: Health, Wealth & Career and Risk & Broking.

~~The extent to which COVID-19 impacts our business and financial position will depend on future developments, which are difficult to predict.~~ These future developments may include the severity and scope of the COVID-19 outbreak, which may unexpectedly change or worsen, and the types and duration of measures imposed by governmental authorities to contain the virus or address its impact. We continue to expect that the COVID-19 pandemic and the related impacts on the wider economic environment will negatively impact our revenue and operating results in fiscal 2021. We believe that these trends and uncertainties are similar to those faced by other comparable registrants as a result of the pandemic. See Part I, Item 1A ‘Risk Factors’ in our Annual Report on Form 10-K, filed with the SEC on February 23, 2021 for a discussion of actual and potential impacts of COVID-19 on our business, clients and operations.

~~Daily Operations -~~ ~~We continue to closely monitor the spread and impact of COVID-19, including the availability of vaccines, while adhering to government health directives.~~ The Company continues to have its own restrictions on business travel, office access, and meetings and events, but is actively developing its return-to-work plans with a focus on safe utilization based on appropriate social-distancing guidelines. We have thorough business continuity and incident management processes in place that have been activated, including split team operations and work-from-home protocols for essential workers which continue to be globally effective. We are communicating frequently with clients and critical vendors, while meeting our objectives via remote working capabilities, overseen and coordinated by our incident management response team. While no contingency plan can eliminate all risk of temporary service interruption, we regularly assess and update our plans to help mitigate reasonable risks to the extent possible.

~~Financial Statement Overview~~

~~For all financial information presented herein, the operating results of Willis Re have been reclassified as discontinued operations (see Note~~ ~~3 – Divestitures in Part I, Item 1 ‘Financial Statements’ in this Form 10-Q for additional information)~~.

~~The table below sets forth our summarized condensed consolidated statements of comprehensive income and data as a percentage of revenue for the periods indicated.~~

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020

($ in millions, except per share data)

Revenue

$
1,973

100
%

$
1,897

100
%

$
6,292

100
%

$
5,946

100
%
Costs of providing services

Salaries and benefits

1,255

64
%

1,238

65
%

3,991

63
%

3,807

64
%
Other operating expenses

385

20
%

370

20
%

1,169

19
%

1,210

20
%
Depreciation

69

3
%

73

4
%

212

3
%

237

4
%
Amortization

85

4
%

108

6
%

285

5
%

347

6
%
Transaction and integration, net
��

(952
)

(48
)%

42

2
%

(877
)

(14
)%

65

1
%
Total costs of providing services

842

1,831

4,780

5,666

Income from operations

1,131

57
%

66

3
%

1,512

24
%

280

5
%
Interest expense

(50
)

(3
)%

(61
)

(3
)%

(161
)

(3
)%

(184
)

(3
)%
Other income, net

105

5
%

156

8
%

617

10
%

321

5
%
INCOME FROM CONTINUING OPERATIONS
   BEFORE INCOME TAXES

1,186

60
%

161

8
%

1,968

31
%

417

7
%
Provision for income taxes

(267
)

(14
)%

(42
)

(2
)%

(386
)

(6
)%

(133
)

(2
)%
INCOME FROM CONTINUING OPERATIONS

919

47
%

119

6
%

1,582

25
%

284

5
%
(LOSS)/INCOME FROM DISCONTINUED
   OPERATIONS, NET OF TAX

(12
)

(1
)%

3

—
%

247

4
%

253

4
%
Income attributable to non-controlling interests

(4
)

—
%

(1
)

—
%

(9
)

—
%

(17
)

—
%
NET INCOME ATTRIBUTABLE TO WILLIS
   TOWERS WATSON

$
903

46
%

$
121

6
%

$
1,820

29
%

$
520

9
%
Diluted earnings per share

$
6.99

$
0.93

$
14.00

$
3.99

~~Consolidated Revenue (Continuing Operations)~~

Revenue was $2.0 billion for the three months ended September 30, 2021, compared to $1.9 billion for the three months ended September 30, 2020, an increase of $76 million, or 4%, on an as-reported basis. Adjusting for the impacts of foreign currency and acquisitions and disposals, our organic revenue growth was 7% for the three months ended September 30, 2021. Revenue for the nine months ended September 30, 2021 was $6.3 billion, compared to $5.9 billion for the nine months ended September 30, 2020, an increase of $346 million, or 6%, on an as-reported basis. Adjusting for the impacts of foreign currency and acquisitions and disposals, our organic revenue growth was 6% for the nine months ended September 30, 2021. The increases to our as-reported revenue for both the current and prior-year periods were driven by strong performances in all segments.

Our revenue can be materially impacted by changes in currency conversions, which can fluctuate significantly over the course of a calendar year. For the three months ended September 30, 2021, currency translation increased our consolidated revenue by $27 million. For the nine months ended September 30, 2021, currency translation increased our consolidated revenue by $190 million. The primary currencies driving these changes were ~~the Pound sterling and Euro.~~

The following table details our top five markets based on the percentage of consolidated revenue (in U.S. dollars) from the countries where work was performed for the nine months ended September 30, 2021. These figures do not represent the currency of the related revenue, which is presented in the next table.

~~Geographic Region~~	~~% of Revenue~~
~~United States~~		49	%
~~United Kingdom~~		19	%
~~France~~		5	%
~~Canada~~		3	%
~~Germany~~		3	%

~~The table below details the percentage of our revenue and expenses by transactional currency for the nine months ended September 30, 2021.~~

Transactional Currency

Revenue

Expenses ⁽ⁱ⁾

U.S. dollars

55
%

52
%
Pounds sterling

13
%

19
%
Euro

17
%

13
%
Other currencies

15
%

16
%

~~(i)~~

These percentages exclude certain expenses for significant items which will not be settled in cash, or which we believe to be items that are not core to our current or future operations. These items include amortization of intangible assets and transaction and integration, net.

The following tables set forth the total revenue for the three and nine months ended September 30, 2021 and 2020 and the components of the changes in total revenue for the three and nine months ended September 30, 2021, as compared to the prior-year period:

Components of Revenue Change ⁽ⁱ⁾

As

Constant

Three Months Ended September 30,

Reported

Currency

Currency

Acquisitions/

Organic

2021

2020

Change

Impact

Change

Divestitures

Change

($ in millions)

Revenue

$
1,973

$
1,897

4%

1%

3%

(4)%

7%

Components of Revenue Change ⁽ⁱ⁾

As

Constant

Nine Months Ended September 30,

Reported

Currency

Currency

Acquisitions/

Organic

2021

2020

Change

Impact

Change

Divestitures

Change

($ in millions)

Revenue

$
6,292

$
5,946

6%

3%

3%

(4)%

6%

~~(i)~~

~~Components of revenue change may not add due to rounding.~~

~~Definitions of Constant Currency Change and Organic Change are included under the section entitled ‘Non-GAAP Financial Measures’ elsewhere within Item 2 of this Form 10-Q.~~

~~Segment Revenue~~

~~The segment descriptions below should be read~~made in conjunction with changes in the ~~full descriptions~~WTW leadership team, including the appointment of ~~our businesses contained in Part I, Item~~a new chief executive officer who succeeded the prior CEO as the chief operating decision maker on that date. Prior to January 1, ~~‘Business’ within our Annual Report on Form 10-K, filed with~~2022, we operated across four segments: Human Capital and Benefits; Corporate Risk and Broking; Investment, Risk and Reinsurance; and Benefits Delivery and Administration. Following the ~~SEC on February 23, 2021.~~

~~Segment revenue excludes amounts that were directly incurred on behalf of our clients and reimbursed by them (reimbursed expenses); however, these amounts are included in consolidated revenue.~~

~~The Company experiences seasonal fluctuations in its revenue. Revenue is typically higher during~~realignment, the ~~Company’s first and fourth quarters due primarily to the timing of broking-related activities.~~

~~Impact~~two new segments consist of the ~~COVID-19 Pandemic on our Segments~~following businesses:

•

The COVID-19 pandemic has had, and is projected to continue to have, an impact on certain of our service offerings. These impacts, which primarily affect our revenue, have been negative in some instances and positive in others and may inHealth, Wealth & Career segment includes businesses previously aligned under the ~~future be material in either event.~~ ~~In addition, the potential negative impacts on our results may lag behind the developments to date~~ related to the COVID-19 pandemic. We have thus far seen the impact of COVID-19 primarily on our business offerings that are discretionary in nature, such as consultative project work, which spans our segments, but primarily affected our HCB segment. However, most of the services we provide, including broking for various insurance products, compliance and valuation services, risk mitigation and outsourced administration for both pension and health and welfare plans, are considered non-discretionary to our clients and recurring in nature. We have seen that these non-discretionary businesses are the least impacted of our offerings, and while we expect that trend to continue, our non-discretionary businesses may be adversely affected due to changing demands in the market.

We expect to continue to experience unpredictable volatility in demand around our discretionary services and solutions. Clients may defer or delay decision-making on planned work or seek to terminate existing agreements for these discretionary services and solutions.

We recognize that the broad, global nature of the COVID-19 crisis has generally impacted the liquidity of our clients and led to disruptions in workforce availability. We continue to monitor the global outbreak of the COVID-19 pandemic and are taking steps to mitigate the risks to us posed by its spread by working with our clients, colleagues, suppliers and other stakeholders. Due to the global breadth of the COVID-19 spread and the range of governmental and community reactions thereto, there is on-going uncertainty around its duration, severity, ultimate impact and the timing of recovery. ~~We will continue to monitor global developments in the rollout of vaccines and government rules and restrictions.~~ We believe the pandemic and workforce availability issues will continue to cause an extended disruption of economic activity for the remainder of 2021 and into 2022, and the impact on our consolidated results of operations, financial position and cash flows could be material. Meanwhile, although we cannot predict how long this situation will last, we continue to focus on maintaining a strong balance sheet, liquidity and financial flexibility.

Human Capital and Benefits ~~(‘HCB’)~~segment, the Benefits Delivery and Administration segment, and the Investment business, which was previously under the Investment, Risk and Reinsurance segment.

•

The Risk & Broking segment includes businesses previously aligned under the Corporate Risk and Broking segment, as well as the Insurance Consulting and Technology business, which was previously under the Investment, Risk and Reinsurance segment.

The following presents descriptions of our reorganized segments:

Health, Wealth & Career

The ~~HCB~~Health, Wealth & Career (‘HWC’) segment provides an array of advice, broking, solutions and ~~software~~technology for employee benefit plans, institutional investors, compensation and career programs, and the employee experience overall. Our portfolio of services support the interrelated challenges that the management teams of our ~~clients. HCB~~clients face across human resources (‘HR’) and finance.

HWC is the ~~largest segment~~larger of the ~~Company~~two segments of the Company. Addressing four key areas, Health, Wealth, Career and Benefits Delivery & Outsourcing, the segment is focused on addressing our clients’ people and risk needs to help them ~~take on the challenges of operating~~succeed in a global marketplace.

Health

The Health & Benefits (‘H&B’) business provides strategy and design consulting,plan management service and support, broking and administration across the full spectrum of health, wellbeing and other group benefit programs, including medical, dental, disability, life, voluntary benefits and other coverage. Our reach extends from small/mid-market clients to large-market and multinational clients, across the full geographic footprint of the Company, and to most industries. We can address our clients’ needs in more than 140 countries.

Our consultants help clients make strategic decisions on topics such as optimizing program spend; evaluating emerging vendors, point solutions and coverage options (including publicly-subsidized health insurance exchanges and private exchanges in the U.S.); and dealing with above-inflation-rate increases in healthcare costs. We also assist clients in selecting the appropriate insurance carriers to cover benefit risks and administer the programs. In addition to our consulting and broking services, we manage a number of collective purchasing initiatives, such as pharmacy and stop-loss, that allow employers to realize greater value from third-party service providers than they can achieve on their own.

With Global Benefits Management, our suite of global services supporting medical, dental and risk (e.g., life, disability) programs, we have a tailored offering for multinationals. This ~~segment~~offering includes a flexible set of ready-made solutions, proven technology and an integrated approach to service delivery that translates to a globally consistent, high-quality experience for our clients.

A meaningful portion of revenue in this business is ~~further strengthened~~from recurring work, though contracts may be annual or multi-year. Given the balance of revenue across consulting, broking and solutions, our revenue is somewhat weighted to the first quarter.

Wealth

Our wealth-related businesses include Retirement and Investment.

The Retirement business provides actuarial support, plan design, and administrative services for all forms of pension and retirement savings plans. Our colleagues help our clients assess the costs and risks of retirement plans on cash flow, earnings and the balance sheet, the effects of changing workforce demographics on their retirement plans, and retiree benefit adequacy and security. We offer clients a full range of integrated retirement consulting services and solutions to meet the needs of all types of employers, including those that continue to offer defined benefit plans and those that are reexamining their retirement benefit strategies. We help multinationals coordinate plan design and actuarial services across their complex global plans. We bring in-depth data analysis and perspective to their decision process, because we have tracked the retirement designs and financing strategies of companies around the world over many decades.

For clients that want to outsource some or all of their pension plan management, we offer broking services, as well as integrated solutions that can combine investment discretionary management, pension administration, core actuarial services, and communication and change management assistance.

Retirement relationships are generally long-term in nature, and client retention rates for this business are high. A significant portion of the revenue in this business is from recurring work, with ~~teams~~multi-year contracts that are driven by the heavily regulated nature of ~~international consultants who provide support through each~~pension plans and our clients’ annual needs for these services. Revenue for the Retirement business in some geographies is somewhat seasonal, as much of our ~~business units~~work pertains to calendar-year plan administration, financing, reporting and compliance; thus, revenue is typically more weighted to the ~~global headquarters of multinational clients~~first and ~~their foreign subsidiaries.~~

~~The following table sets forth HCB segment revenue for the three months ended September 30, 2021 and 2020, and the components~~fourth quarters of the ~~change in revenue for the three months ended September 30, 2021 from the three months ended September 30, 2020.~~fiscal year.

~~(i)~~

~~Components of revenue change may not add due to rounding.~~

~~HCB segment revenue for the three months ended September 30, 2021~~Our Investment business provides advice and ~~2020 was $852 million~~discretionary investment management solutions to defined benefit and $796 million, respectively. On an organic basis, Talent and Rewards led the segment’s revenue growth, driven by strong market demand for rewards advisory work coupled with talent and compensation products. Health and Benefits revenue grew primarily from increased consulting work and commissions in North America alongside continued expansion of our local portfolios and global benefits management appointments outside of North America. Technology and Administrative Solutions revenue increased duedefined contribution pension plans as well as to new project and client activity in Great Britain. Retirement revenue was materially flat with growth in Great Britain driven by funding and Guaranteed Minimum Pension (‘GMP’) equalization work largely offset by a ~~decline in revenue in North America, resulting from decreased de-risking activity.~~

The following table sets forth HCB segment revenue for the nine months ended September 30, 2021 and 2020, and the components of the change in revenue for the nine months ended September 30, 2021 from the nine months ended September 30, 2020.

~~(i)~~

~~Components of revenue change may not add due to rounding.~~

HCB segment revenue for the nine months ended September 30, 2021 and 2020 was $2.6 billion and $2.4 billion, respectively. On an organic basis, Talent and Rewards led the segment’s revenue growth, driven by strong market demand for broad-based talent and rewards advisory work coupled with talent and compensation products. Health and Benefits revenue grew primarily from increased consulting work in North America alongside continued expansion of our local portfolios and global benefits management appointments outside of North America. Retirement revenue increased with growth in Great Britain driven by funding and Guaranteed Minimum Pension (‘GMP’) equalization work and increased consulting project activity in Western Europe and International. Technology and Administrative Solutions revenue increased due to new project and client activity in Great Britain.

~~Corporate Risk and Broking (‘CRB’)~~

~~The CRB segment provides a broad~~ range of ~~risk advice, insurance broking~~other client types including insurers, endowments and ~~consulting services~~foundations, and private wealth investors. We provide a solution to a significant business problem faced by our clients, ~~worldwide, ranging from small businesses~~namely sustaining the resources and skills required to ~~multinational corporations. The segment delivers integrated global solutions tailored~~deliver a financial services product in highly competitive capital markets. We offer a flexible approach that adapts to a wide range of client needs and ~~underpinned~~circumstances, with the objective of higher returns, lower risk and lower costs within each client’s unique situation.

Our solutions range from single asset class activity, through complete management of entire pension plan assets including sophisticated liability hedging programs.

We bring together a broad array of specialist investment knowledge and skills across all asset classes, a high-quality execution platform, a cost advantage through our scale, and expert advisors with experience across all client types from the largest plans in the world to small corporate pension plans.

We have long-term relationships with our Investment clients, with the majority of our revenue driven by retainer contracts.

Career

Ourcareer-related offerings include advice, data, software and products to address clients’ total rewards and talent issues across the globe delivered through our Work & Rewards and Employee Experience businesses.

Within our Work & Rewards business, we help clients determine the best ways to get work done, the skills needed for jobs, and how to reward it. We address executive compensation and broad-based rewards. We advise our clients’ management and boards of directors on all aspects of executive pay programs, including base pay, annual bonuses, long-term incentives, perquisites and other

benefits. Our focus is on aligning pay plans with an organization’s business strategy and driving desired performance. Our solutions incorporate proprietary market benchmarking data and ~~analytics.~~software to support compensation administration.

Our Employee Experience business focuses on the provision of solutions including employee insight and listening tools, talent assessment tools and services, communication and change management services.

Revenue for our career-related businesses is partly seasonal in nature, with heightened activity in the second half of the calendar year during the annual compensation, benefits, and survey cycles. While these businesses enjoy long-term relationships with many clients, work in several practices is often project-based and can be sensitive to economic changes. The ~~following table sets forth CRB segment revenue for~~businesses benefit from regulatory changes affecting our clients that require strategic advice, program changes and communication, as well as the ~~three months ended September 30, 2021~~focus on ESG as a component of executive and ~~2020,~~board pay, the redefinition of jobs, work location and career paths as technology disaggregates work, and the ~~components~~recalibration of ~~the change in revenue for the three months ended September 30, 2021 from the three months ended September 30, 2020.~~

~~(i)~~

~~Components of revenue change may not add due to rounding.~~

CRB segment revenue for the three months ended September 30, 2021 and 2020 was $697 million and $649 million, respectively. On an organic basis, North America led the segment primarily from new business across M&A, FINEX, Construction and Aerospace alongside gains recorded in connection with book-of-business settlements. The gains from the book-of-business sales relate to settlements when colleagues depart for a competitor, which has the impact of increasing revenue in the quarter of the settlement. However, we expect these departures will result in decreasing revenue going-forward due to the increase in competition. Revenue in International, Great Britain and Western Europe also increased with new business generation and strong renewals across several insurance lines, most notably, in FINEX and Retail.

~~The following table sets forth CRB segment revenue for the nine months ended September 30, 2021 and 2020,~~pay and the ~~components of the change in revenue for the nine months ended September 30, 2021 from the nine months ended September 30, 2020.~~

~~(i)~~employee experience amidst shifting labor markets.

~~Components of revenue change may not add due to rounding.~~

CRB segment revenue for the nine months ended September 30, 2021 and 2020 was $2.3 billion and $2.1 billion, respectively. On an organic basis, North America led the segment with strong renewals, primarily in FINEX, alongside gains recorded in connection with book-of-business settlements. International and Great Britain revenue increased with new business generation primarily in the FINEX and Construction insurance lines. Revenue in Western Europe was materially flat as new business wins and renewal expansion was offset by challenges related to senior staff departures.

~~Investment, Risk and Reinsurance (‘IRR’)~~

The IRR segment uses a sophisticated approach to risk, which helps our clients free up capital and manage investment complexity. This segment works closely with investors, reinsurers and insurers to manage the equation between risk and return. Blending advanced analytics with deep institutional knowledge, IRR identifies new opportunities to maximize performance. This segment provides investment consulting and discretionary management services and insurance-specific services and solutions through reserves opinions, software, ratemaking, risk underwriting and reinsurance broking.

~~In August 2021, the Company entered into an agreement with Arthur J. Gallagher & Co. to sell Willis Re, with the transaction~~ ~~expected to be completed no later than the end of the first quarter of~~ 2022 (see Note 3 — Divestitures within Item 1 of this Quarterly Report on Form 10-Q for further information). As a result, we have reclassified revenue associated with Willis Re to discontinued operations within our condensed consolidated statements of comprehensive income, and therefore it is not included for each of the periods presented below.

In September 2020, the Company sold its Max Matthiessen business, and the sale of Miller, its wholesale insurance broking subsidiary, was completed on March 1, 2021 (see Note 3 — Divestitures within Item 1 of this Quarterly Report on Form 10-Q for further information).

The following table sets forth IRR segment revenue for the three months ended September 30, 2021 and 2020, and the components of the change in revenue for the three months ended September 30, 2021 from the three months ended September 30, 2020.

~~(i)~~

~~Components of revenue change may not add due to rounding.~~

IRR segment revenue for the three months ended September 30, 2021 and 2020 was $172 million and $220 million, respectively. On an organic basis, advisory-related fees led the revenue growth in both our Insurance Consulting and Technology business and Investment business, which was further aided by increased contingent performance fees.

The following table sets forth IRR segment revenue for the nine months ended September 30, 2021 and 2020, and the components of the change in revenue for the nine months ended September 30, 2021 from the nine months ended September 30, 2020.

~~(i)~~

~~Components of revenue change may not add due to rounding.~~

IRR segment revenue for the nine months ended September 30, 2021 and 2020 was $615 million and $716 million, respectively. On an organic basis, advisory-related fees led the revenue growth in both our Investment business and Insurance Consulting and Technology business. Revenue growth in these businesses was further aided by increased contingent performance fees and software sales. The growth was partially offset by a decline in Wholesale’s revenue in the first quarter as a result of headwinds across coverage lines coupled with a strategic shift in its operating model.

Benefits Delivery ~~and~~& Outsourcing

Our Benefits Delivery & Outsourcing businesses include Benefits Delivery & Administration (‘BDA’) and Technology and Administration Solutions (‘TAS’).

TheBDA ~~segment~~business provides primary medical and ancillary benefit exchange and outsourcing services to active employees and retirees across both the group and individual ~~markets.~~ markets, primarily in the U.S.

A significant portion of the revenue in this ~~segment~~business is recurring in nature, driven by either the commissions from the policies we sell, or from long-term service contracts with our clients that typically range from three to five years. Revenue across this ~~segment may be~~business is seasonal ~~driven by the magnitude~~ and ~~timing of client enrollment activities, which often occur during~~is generally higher in the fourth quarter as it is driven when typical annual enrollment activity occurs.

BDA provides services via two related offerings:

Benefits Outsourcing is focused on serving active employee groups for clients across the U.S. Working closely with ~~increased membership~~other HWC businesses, we use our proprietary technology to provide a suite of health and welfare and pension administration outsourcing services, including tools to enable benefit modeling, decision support, enrollment and benefit choice. Drawing on expertise in H&B and Retirement to create high-performing benefit plan designs, we believe we are well-positioned to help clients of all sizes simplify their benefits delivery, while lowering the total costs of benefits and related administration.

Individual Marketplace offers decision support processes and tools to connect consumers with insurance carriers in private individual and Medicare markets. Individual Marketplace serves both employer-based and direct-to-consumer populations through its end-to-end consumer acquisition and engagement platforms, which tightly integrate call routing technology, an efficient quoting and enrollment engine, a customer relations management system and deep links with insurance carriers. By leveraging its multiple distribution channels and diverse product portfolio, Individual Marketplace offers solutions to a broad consumer base, helping individuals compare, purchase and use health insurance products, tools and information for life.

Our TAS business provides pension outsourcing services to hundreds of clients across multiple industries. Our TAS team focuses on clients outside of the U.S. where our services are supported by high quality administration teams using robust technology platforms. Given the nature of the work, our revenue is distributed generally evenly across the year.

With ongoing servicing requirements and multi-year contracts in place, we have high client retention rates. We are the leading administrator among the 200 largest pension plans in the U.K., as well as a leader in Germany.

For both our defined benefit and defined contribution administration services, we use highly-automated processes and technology to enable benefit plan members to access and manage their records, perform self-service functions and improve their understanding of their benefits. Our technology also provides trustees and HR teams with timely management information to monitor activity and service levels ~~typically effective January 1, after calendar year-end benefits elections.~~and reduce administration costs.

Risk & Broking

The Risk & Broking (‘R&B’) segment provides a broad range of risk advice, insurance brokerage and consulting services to clients worldwide ranging from small businesses to multinational corporations.

The segment comprises two primary businesses:

Corporate Risk & Broking (‘CRB’)

The ‘CRB’ business places more than $25 billion of premiums into the insurance markets on an annual basis, and delivers integrated global solutions tailored to client needs, underpinned by data and analytics through a balanced matrix of global lines of business across all of the Company’s three geographical areas: North America, Europe (including Great Britain) and International.

The global lines of business include:

Property and Casualty — Property and Casualty provides property and liability insurance brokerage services across a wide range of industries and segments including real estate, healthcare and retail. We also arrange insurance products and services for our affinity client partners to offer to their customers, employees, or members alongside, or in addition to, their principal business offerings.

Aerospace —Aerospaceprovides specialist expertise to the aerospace and space industries. Our aerospace business provides insurance broking, risk management services, contractual and technical advisory expertise to aerospace clients worldwide, including the world’s leading airlines, aircraft manufacturers, air cargo handlers and other airport and general aviation companies. The specialist InSpace team is also prominent in providing insurance and risk management services to the space industry.

Construction — Our Construction business provides services that include insurance broking, claims, loss control and specialized risk advice for a wide range of construction projects and activities. Clients include contractors, project owners, public entities, project managers, consultants and financiers, among others.

Global Markets Direct & Facultative — Operating in the major wholesale reinsurance hubs across the world, including London, Bermuda, Singapore, Hong Kong and Shanghai, solutions are delivered both directly to clients for the most complex property and casualty risks and as facultative reinsurance placements where we serve as an intermediary for insurance companies. Facultative solutions are provided across various classes of risk for our insurer clients, some of which may also be direct clients of WTW. The aim is to deliver optimum results for our clients by getting the right risk to the right market by the right broker, be it local, wholesale or facultative every time.

Financial, Executive and Professional Risks (‘FINEX’) — FINEX encompasses all financial and executive risks, delivering client solutions that range from management and professional liability, employment practices liability, crime, cyber and M&A-related insurances to risk consulting and advisory services. Specialist teams provide risk consulting and risk transfer solutions to a broad spectrum of clients across a multitude of industries, as well as the financial and professional service sectors.

Financial Solutions — Financial Solutions provides insurance broking services and specialized risk advice related to credit and political risk and crisis management, including terrorism, kidnap and ransom and contingency risk. Clients include international banks, leasing companies, commodity traders, export credit agencies, multinational corporations and sporting institutions.

Surety —The Global Surety team provides expertise in placing bonds across all industries and around the world. A surety bond is a financial instrument that guarantees contractual performance, statutory compliance, and financial assurance for domestic and international companies.

Marine —Marineprovides specialist expertise to the maritime and logistics industries. Our Marine business provides insurance broking services related to hull and machinery, cargo, protection and indemnity, fine art and general marine liabilities, among others. Our Marine clients include, but are not limited to, ship owners and operators, shipbuilders, logistics operations, port authorities, traders, shippers, exhibitors and secure transport companies.

Natural Resources — Our Natural Resources practice encompasses the oil, gas and chemicals, mining and metals, power and utilities and renewable energy sectors. It provides sector-specific risk transfer solutions and insights, which include insurance broking, risk engineering, contractual reviews, wording analysis and claims management.

Insurance Consulting and Technology (‘ICT’)

ICT is a global business that provides advice and technology solutions to the insurance industry. We leverage our industry experience, strategic perspective and analytical skills to help clients measure and manage risk and capital, improve business performance and create a sustainable competitive advantage. Our services include software and technology, risk and capital management, products and product pricing, financial and regulatory reporting, financial and capital modeling, M&A, outsourcing and business management.

Transformation Program

Inthe fourth quarter of 2021, we initiated a three-year ‘Transformation program’ designed to enhance operations, optimize technology and align our real estate footprint to our new ways of working. We expect the program to generate annual cost savings of

approximately $300 million by the end of 2024. The program is expected to include cumulative costs of approximately $490 million and capital expenditures of approximately $260 million, for a total investment of $750 million. The main categories of charges will be

in the following ~~table sets forth BDA segment revenue~~four areas:

•

Other — other costs not included above including fees for professional services, other contract terminations not related to the above categories and supplier migration costs.

Certain costs under the Transformation program are accounted for under ASC 420, Exit or Disposal Cost Obligation, and are included as restructuring costs in the condensed consolidated statements of comprehensive income. For the three months ended March 31, 2022, restructuring charges under our Transformation program totaled $6 million. Other costs incurred under the Transformation program are included in transaction and transformation, net and were $5 million for the three months ended ~~September 30, 2021~~March 31, 2022. From the actions taken through the first quarter of 2022, we have identified an additional $16 million of annualized run-rate savings in the quarter, and ~~2020,~~$36 million of cumulative annualized run-rate savings identified to date since the inception of the program. Savings are primarily attributable to the reduction of real estate and technology costs and the ~~components~~benefits from the program have begun to be recognized during 2022.

For a discussion of some of the ~~change~~risks associated with the Transformation program, see Part I, Item 1A ‘Risk Factors’ in ~~revenue for~~our Annual Report on Form 10-K, filed with the ~~three months ended September 30, 2021 from the three months ended September 30, 2020.~~SEC on February 24, 2022.

~~(i)~~Financial Statement Overview

~~Components of revenue change may not add due to rounding.~~

BDA segment revenue for the three months ended September 30, 2021 and 2020 was $242 million and $226 million, respectively. BDA’s organic revenue increase was led by Individual Marketplace, primarily by TRANZACT, which generated revenue of $111 million in the third quarter with strong growth in Medicare Advantage and Life sales. Benefits Outsourcing revenue also increased, driven by its expanded client base.

The following table sets forth BDA segment revenue for the nine months ended September 30, 2021 and 2020, and the components of the change in revenue for the nine months ended September 30, 2021 from the nine months ended September 30, 2020.

~~(i)~~

~~Components of revenue change may not add due to rounding.~~

BDA segment revenue for the nine months ended September 30, 2021 and 2020 was $771 million and $666 million, respectively. BDA’s organic revenue increase was led by Individual Marketplace, primarily by TRANZACT, which generated year-to-date revenue of $375 million with strong growth in Medicare Advantage and Life sales. Benefits Outsourcing revenue also increased, driven by its expanded client base.

~~Costs of Providing Services (Continuing Operations)~~

Forall prior-year period financial information presented herein, the operating results of Willis Re have been reclassified as discontinued operations (see Note 3 –— Acquisitions and Divestitures inwithin Part I, Item 1 ‘Financial Statements’ in this Form 10-Q for additional ~~information)~~information).

The table below sets forth our summarized condensed consolidated statements of comprehensive income and data as a percentage of revenue for the periods indicated.


	Three Months Ended March 31,
	2022					2021
	($ in millions, except per share data)
Revenue	$	2,160		100	%	$	2,228		100	%
Costs of providing services
Salaries and benefits		1,318		61	%		1,419		64	%
Other operating expenses		486		23	%		400		18	%
Depreciation		66		3	%		71		3	%
Amortization		85		4	%		103		5	%
Restructuring costs		6		—	%		—		—	%
Transaction and transformation, net		20		1	%		24		1	%
Total costs of providing services		1,981					2,017
Income from operations		179		8	%		211		9	%
Interest expense		(49	)	(2	)%		(59	)	(3	)%
Other income, net		27		1	%		438		20	%
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		157		7	%		590		26	%
Provision for income taxes		(43	)	(2	)%		(44	)	(2	)%
INCOME FROM CONTINUING OPERATIONS		114		5	%		546		25	%
INCOME FROM DISCONTINUED OPERATIONS, NET OF TAX		11		1	%		190		9	%
Income attributable to non-controlling interests		(3	)	—	%		(3	)	—	%
NET INCOME ATTRIBUTABLE TO WTW	$	122		6	%	$	733		33	%
Diluted earnings per share from continuing operations	$	0.94				$	4.17

Consolidated Revenue (Continuing Operations)

Revenue for both the three months ended March 31, 2022 and 2021 was $2.2 billion, a decrease of $68 million, or 3%, on an as-reported basis. Adjusting for the impacts of foreign currency and acquisitions and disposals, our organic revenue growth was 2% for the three months ended March 31, 2022. The increase in organic revenue was driven by our HWC segment.

Our revenue can be materially impacted by changes in currency conversions, which can fluctuate significantly over the course of a calendar year. For the three months ended March 31, 2022, currency translation decreased our consolidated revenue by $54 million. The primary currencies driving this change were the Euro and Pound sterling.

The following table details our top five markets based on the percentage of consolidated revenue (in U.S. dollars) from the countries where work was performed for the three months ended March 31, 2022. These figures do not represent the currency of the related revenue, which is presented in the next table.


Geographic Region	% of Revenue
United States		46	%
United Kingdom		19	%
France		7	%
Germany		4	%
Canada		3	%

The table below details the approximate percentage of our revenue and expenses from continuing operations by transactional currency for the three months ended March 31, 2022.


Transactional Currency	Revenue			Expenses (i)
U.S. dollars		52	%		53	%
Pounds sterling		12	%		17	%
Euro		21	%		14	%
Other currencies		15	%		16	%

(i)

The following table sets forth the total revenue for the three months ended March 31, 2022 and 2021 and the components of the change in total revenue for the three months ended March 31, 2022, as compared to the prior year period. The components of the revenue change may not add due to rounding.

Components of Revenue Change

Less:

Constant

Less:

Three Months Ended March 31,

Reported

Currency

Acquisitions/

Organic

2022

2021

Change

Impact

Change

Divestitures

Change

($ in millions)

Revenue

2,160

2,228

(3)%

(2)%

(1)%

(2)%

Definitions of Constant Currency Change and Organic Change are included under the section entitled ‘Non-GAAP Financial Measures’ elsewhere within Item 2 of this Form 10-Q.

Segment Revenue

For further information on our segment reorganization and a full description of our businesses, please see ‘Segment Reorganization’ elsewhere within Part I, Item 2 of this Quarterly Report on Form 10-Q.

Segment revenue excludes amounts that were directly incurred on behalf of our clients and reimbursed by them (reimbursed expenses); however, these amounts are included in consolidated revenue.

The Company experiences seasonal fluctuations in its revenue. Revenue is typically higher during the Company’s first and fourth quarters due primarily to the timing of broking-related activities.

Within the tables presented below, the components of revenue change provided may not add due to rounding. The prior-year segment information has been conformed to the current-year presentation.

HWC Revenue

The following table sets forth HWC revenue for the three months ended March 31, 2022 and 2021 and the components of the change in revenue for the three months ended March 31, 2022 from the three months ended March 31, 2021.

Components of Revenue Change

Less:

Constant

Less:

Three Months Ended March 31,

Reported

Currency

Acquisitions/

Organic

2022

2021

Change

Impact

Change

Divestitures

Change

($ in millions)

Segment revenue

1,244

1,233

(2)%

—%

HWC segment revenue for both the three months ended March 31, 2022 and 2021 was $1.2 billion. Organic growth was led by the Health business, primarily due to an increase in consulting assignments in North America. Career also contributed strong growth, driven by market demand for reward-based advisory services and compensation benchmarking products as new work models become increasingly prevalent. Wealth revenue increased, with growth in the Investment business from its expanded client base. Benefits Delivery & Outsourcing revenue declined as a result of a shift in the timing of revenue, which we expect to normalize on a full-year basis, coupled with lower growth in Medicare Advantage revenue.

R&B Revenue

The following table sets forth R&B revenue for the three months ended March 31, 2022 and 2021 and the components of the change in revenue for the three months ended March 31, 2022 from the three months ended March 31, 2021.

Components of Revenue Change

Less:

Constant

Less:

Three Months Ended March 31,

Reported

Currency

Acquisitions/

Organic

2022

2021

Change

Impact

Change

Divestitures

Change

($ in millions)

Segment revenue

891

924

(4)%

—%

R&B segment revenue for the three months ended March 31, 2022 and 2021 was $891 million and $924 million, respectively. On an organic basis, Insurance Consulting and Technology grew from both increased advisory work and software sales. The growth was largely offset by a decline in revenue in Corporate Risk & Broking due to headwinds from book-of-business sales recorded in the comparable period last year. Excluding $15 million of book-of-business sales activity, revenue increased modestly, primarily from new business in North America in the FINEX and M&A lines. The year-over-year decline in Russia-related revenue was $14 million.

Costs of Providing Services (Continuing Operations)

Forall prior-year period financial information presented herein, the operating results of Willis Re have been reclassified as discontinued operations (see Note 3 — Acquisitions and Divestitures within Part I, Item 1 ‘Financial Statements’ in this Form 10-Q for additional information).

Total costs of providing services for both the three months ended ~~September 30,~~March 31, 2022 and 2021 were ~~$842 million, compared to $1.8~~$2.0 billion, ~~for the three months ended September 30, 2020,~~ a decrease of ~~$989~~$36 million, or ~~54%~~2%. Total costs of providing services for the nine months ended September 30, 2021 were $4.8 billion, compared to $5.7 billion for the nine months ended September 30, 2020, a decrease of $886 million, or 16%. These decreases were primarily due to the $1 billion income receipt related to the termination of the proposed Aon transaction during the current quarter. See the following discussion for further details.

Salaries and ~~benefits~~Benefits

Salaries and benefits for the three months ended ~~September 30, 2021~~March 31, 2022 were $1.3 billion, compared to ~~$1.2~~$1.4 billion for the three months ended ~~September 30, 2020, an increase~~March 31, 2021, a decrease of ~~$17~~$101 million, or 1%7%. The ~~increase this quarter was~~decrease in the current year is mostly due to ~~higher~~lower incentive and benefit accruals ~~as compared to~~for the ~~prior year.~~period. Salaries and benefits, as a percentage of revenue, represented ~~64%~~61% and ~~65%~~64% for the three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ respectively.

Salaries and benefits for the nine months ended September 30, 2021 were $4.0 billion, compared to $3.8 billion for the nine months ended September 30, 2020, an increase of $184 million, or 5%. The increase for the first nine months of 2021 is primarily due to higher incentive and benefit accruals for the period along with increases in our share-based compensation expense. Higher stock prices in 2021 drove most of the increase in share-based compensation expense, since our liability-classified awards are adjusted to fair value each quarter based on our share price. Salaries and benefits, as a percentage of revenue, represented 63% and 64% for the nine months ended September 30, 2021 and 2020, respectively.Other Operating Expenses

~~Other operating expenses~~

Other operating expenses for the three months ended ~~September 30, 2021~~March 31, 2022 were ~~$385~~$486 million, compared to ~~$370~~$400 million for the three months ended ~~September 30, 2020,~~March 31, 2021, an increase of ~~$15~~$86 million, or 4%22%. The increase was ~~mostly~~primarily due to asset impairments, mostly accounts receivables, related to Russian insurance contracts placed by U.K. brokers in the London market (see Note 3 — Acquisitions and Divestitures within Part I, Item 1 ‘Financial Statements’ in this Form 10-Q for additional information) and higher ~~marketing and professional~~business insurance ~~costs, partially offset by lower non-income tax and local office~~ costs for the current ~~quarter~~year as compared to the ~~same period in the~~ prior year. Other operating expenses were $1.2 billion for both the nine months ended September 30, 2021 and 2020, a decrease of $41 million, or 3%. This improvement was primarily due to decreases in travel and entertainment costs, local office expenses, bad debt expense and non-income tax costs, partially offset by higher marketing and insurance costs for the first nine months of 2021 as compared to the same period in the prior year.

~~Depreciation~~34

Depreciation

Depreciation for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$69~~$66 million, compared to ~~$73~~$71 million for the three months ended ~~September 30, 2020,~~March 31, 2021, a decrease of $4$5 million, or 5%7%. T~~he quarter-over-quarter~~The year-over-year decrease was primarily due to a lower depreciable base of assets ~~due to~~resulting from business disposals over the last two years and ~~reduced capital expenditures in 2021.~~ ~~Depreciation for the nine months ended September 30, 2021 was $212 million, compared to $237 million for the nine months ended September 30, 2020,~~ a ~~decrease~~lower dollar value of $25 million, or 11%. The year-over-year decrease was primarily due to the prior year acceleration of depreciation of $35 million related to the abandonment of an internally-developed software asset prior to being placed in service. This decrease was partially offset by additional assets placed in service during ~~2020 and 2021.~~2021.

Amortization

Amortization for the three months ended ~~September 30, 2021~~March 31, 2022 was $85 million, compared to ~~$108~~$103 million for the three months ended ~~September 30, 2020,~~March 31, 2021, a decrease of ~~$23~~$18 million, or ~~21%. Amortization for the nine months ended September 30, 2021 was $285 million, compared to $347 million for the nine months ended September 30, 2020, a decrease of $62 million, or 18%~~17%. Our intangible amortization is generally more heavily weighted to the initial years of the useful lives of the related intangibles, and therefore amortization related to intangible assets will continue to decrease over time.

Restructuring Costs

Restructuring costs for the three months ended March 31, 2022 were $6 million primarily related to the real estate rationalization component of the Transformation program commenced by the Company during the fourth quarter of 2021 (see ‘Transformation Program’ within this Part I, Item 2 and Note 6 — Restructuring Costs within Part I, Item 1 ‘Financial Statements’ of this Quarterly Report on Form 10-Q).

Transaction and ~~integration, net~~Transformation, Net

Transaction and ~~integration,~~transformation, net for the three months ended ~~September 30, 2021 was income of $952~~March 31, 2022 were $20 million, compared to ~~$42~~$24 million ~~of expenses~~ for the three months ended ~~September 30, 2020.~~March 31, 2021. Transaction and ~~integration, net for the nine months ended September 30, 2021 was $877 million of income, compared to $65 million of~~transformation expenses for the ~~nine months ended September 30, 2020. The income for both the~~ current ~~quarter and year-to-date was primarily due to the $1 billion income receipt~~year were comprised of consulting fees related to the termination of the proposed Aon transaction during the quarter, partially offset by costs mostly related to the terminated proposed transaction. The expenses for the three and nine months ended September 30, 2020 consist of transaction costs, primarilyTransformation program (see ‘Transformation Program’ within this Part I, Item 2), as well as legal fees and other ~~professional~~transaction costs. Transaction and transformation, net for the prior-year period were comprised primarily of legal fees related to ~~the proposed~~our then-proposed combination with ~~Aon prior to its termination.~~Aon.

Income from Operations

Income from operations for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$1.1 billion,~~$179 million, compared to ~~$66~~$211 million for the three months ended ~~September 30, 2020, an increase~~March 31, 2021, a decrease of $1.1 billion. Income from operations for the nine months ended September 30, 2021 was $1.5 billion, compared to $280 million for the nine months ended September 30, 2020, an increase of $1.2 billion. The increases in both the quarter and year-to-date results were mostly due to the $1 billion income receipt$32 million. This decrease resulted primarily from the ~~termination of~~asset impairment expense discussed above and lower revenue, partially offset by lower incentive compensation accruals in the ~~proposed Aon transaction and higher revenue.~~current quarter.

Interest Expense

Interest expense for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$50~~$49 million, compared to ~~$61~~$59 million for the three months ended ~~September 30, 2020,~~March 31, 2021, a decrease of ~~$11~~$10 million, or ~~18%~~17%. ~~Interest expense for the nine months ended September 30, 2021~~This decrease was ~~$161 million, compared to $184 million for the nine months ended September 30, 2020, a decrease of $23 million, or 13%. These decreases were~~ primarily the result of lower levels of indebtedness in the current year.

Other Income, Net

Other income, net for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$105~~$27 million, compared to ~~$156~~$438 million for the three months ended ~~September 30, 2020, a decrease~~March 31, 2021. Other income for the current year primarily consisted of ~~$51 million, primarily resulting from a~~ ~~lower net gain~~pension income partially offset by the loss on ~~disposals of operations during~~ the ~~current-year period~~.

Russian deconsolidation. Other income, net ~~for~~in the ~~nine months ended September 30, 2021 was $617 million, compared to $321 million for the nine months ended September 30, 2020, an increase~~prior-year period consisted primarily of ~~$296 million, primarily resulting from~~ the net gain on ~~disposals of operations, mostly due to the~~ disposal of our Miller business (see Note 3 – Acquisitions and Divestitures in Part I, Item 1 ‘Financial Statements’ in this Form 10-Q).

Provision for Income Taxes

Provision for income taxes ~~on continuing operations~~ for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$267~~$43 million, compared to ~~$42~~$44 million for the three months ended ~~September 30, 2020, an increase~~March 31, 2021, a decrease of ~~$225~~$1 million. The effective tax rate was ~~22.5%~~27.5% for the three months ended ~~September 30, 2021,~~March 31, 2022, and ~~26.6%~~7.4% for the three months ended September 30, 2020. Provision for income taxes on continuing operations for the nine months ended September 30, 2021 was $386 million, compared to $133 million for the nine months ended September 30, 2020, an increase of $253 million. The effective tax rate was 19.6% for the nine months ended September 30, 2021 and 31.9% for the nine months ended September 30, 2020.March 31, 2021. These effective tax rates are calculated using extended values from our condensed consolidated statements of comprehensive income and are therefore more precise tax rates than can be calculated from rounded values. The prior quarter effective tax rate was lower due to the tax-exempt disposal of our Miller business. Additionally, the current quarter effective tax rate includes ~~a $250 million estimated~~the tax ~~expense related to the income receipt~~effect of the termination payment, however the prior year effective tax rate for the three months ended September 30, 2020 was higher due to an additional deferred tax expense related to the enacted U.K. statutory tax rate change. The prior-year nine months effective tax rate was higher due to additional tax expense recognized in connection with the temporary provisionsdivestment of ~~the Coronavirus Aid, Relief, and Economic Security (‘CARES’) Act.~~our Russia business.

~~(Loss)/~~Income from Discontinued Operations, Net of Tax

~~Loss~~ Income from discontinued operations, net of tax for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$12~~$11 million, compared to ~~income from discontinued operations, net of tax of $3~~$190 million for the three months ended ~~September 30, 2020,~~ March 31, 2021, a decrease of ~~$15 million. Income from discontinued operations, net of tax for the nine months ended September 30, 2021 was $247~~$179 million ~~compared to $253 million for the nine months ended September 30, 2020, a decrease of $6 million.~~. The operations of our Willis Re business ~~have been~~were reclassified to discontinued operations upon our entering into an agreement to sell the business during the third quarter of 2021 (see Note 3 – Acquisitions and Divestitures in Part I, Item 1 ‘Financial Statements’ in this Form 10-Q). ~~See~~Income from discontinued

operations in the ~~following discussion for further details.~~current year is attributable to the operations of the deferred closing entities and run-off activity associated with the divestiture.

~~Revenue from discontinued operations~~Net Income Attributable to WTW

~~Revenue from discontinued operations~~Net income attributable to WTW for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$111~~$122 million, compared to ~~$112~~$733 million for the three months ended ~~September 30, 2020,~~March 31, 2021, a decrease of ~~$1 million. Revenue from discontinued operations for the nine months ended September 30, 2021~~$611 million, or 83%. This decrease was $668 million, compared to revenue of $642 million for the nine months ended September 30, 2020, an increase of $26 million which was driven by new business wins and favorable renewal factors in the first half of the year.

~~Salaries and benefits~~

Salaries and benefits attributable to discontinued operations for the three months ended September 30, 2021 was $97 million, compared to $93 million for the three months ended September 30, 2020, an increase of $4 million. Salaries and benefits attributable to discontinued operations for the nine months ended September 30, 2021 was $291 million, compared to $281 million for the three months ended September 30, 2020, an increase of $10 million. The increases for both the three and nine months ended September 30, 2021 related to increased incentive accruals.

~~Other operating expenses~~

Other operating expenses attributable to discontinued operations for the three months ended September 30, 2021 was $29 million, compared to $12 million for the three months ended September 30, 2020, an increase of $17 million. Other operating expenses attributable to discontinued operations for the nine months ended September 30, 2021 were $60 million, compared to $43 million for the nine months ended September 30, 2020, an increase of $17 million. The increase in costs in 2021 is due primarily to transaction costs related to the pending sale of the business to ~~Arthur J. Gallagher & Co.~~

~~Depreciation and amortization~~

Depreciation and amortization was not material for the three months ended September 30, 2021 and 2020 and was $1 million and $2 million for the nine months ended September 30, 2021 and 2020, respectively.

~~Other income, net~~

Other income, net was not material for the three months ended September 30, 2021 and 2020 and was $1 million and $3 million for the nine months ended September 30, 2021 and 2020, respectively, which was entirely attributable to foreign currency transaction gains.

~~(Benefit from)/provision for income taxes on discontinued operations~~

The benefit from income taxes attributable to discontinued operations was $3 million, compared to a provision for income tax expense of $4 million for the three months ended September 30, 2021 and 2020, respectively. The provisions for income tax expense were $70 million and $66 million for the nine months ended September 30, 2021 and 2020, respectively.

~~Net Income Attributable to Willis Towers Watson~~

Net income attributable to Willis Towers Watson for the three months ended September 30, 2021 was $903 million, compared to $121 million for the three months ended September 30, 2020, an increase of $782 million. Net income attributable to Willis Towers Watson for the nine months ended September 30, 2021 was $1.8 billion, compared to $520 million for the nine months ended September 30, 2020, an increase of $1.3 billion. The increases for both periods were primarily due to the ~~$1 billion income receipt from the termination of the proposed Aon transaction and higher revenue, with the year-to-date results also benefitting from~~prior-year gain on the sale of ~~our~~the Miller business, lower net income from the discontinued operations of our Willis Re business, the asset impairment expense discussed above and lower revenue, partially offset by lower incentive compensation accruals in the ~~first quarter of 2021 (see Note 3 – Divestitures in Part I, Item 1 ‘Financial Statements’ in this Form 10-Q).~~current quarter.

Liquidity and Capital Resources

Executive Summary

Our principal sources of liquidity are funds generated by operating activities, available cash and cash equivalents and amounts available under our revolving credit facilities and any new debt ~~offerings, which were subject to the limitations set forth in the Aon combination agreement prior to the Termination.~~offerings.

The COVID-19 pandemic has contributed to significant volatility in financial markets, including occasional declines in equity markets, inflation and changes in interest rates and reduced liquidity on a global basis. Specific to ~~Willis Towers Watson,~~WTW, over the past two years, the COVID-19 pandemic ~~has~~ had aan initial negative impact on discretionary work we perform for our clients, ~~although~~but we ~~have seen a~~later saw increased demand for these services begin to return in the second quarter of 2021 ~~and continue through the third quarter of 2021.~~which continues into 2022. We continue to have decreased spending on travel and associated expenses and third-party contractors, and we have the ability to contain spending on discretionary projects and certain capital expenditures.

Based on our current balance sheet and cash flows, current market conditions and information available to us at this time, we believe that ~~Willis Towers Watson~~WTW has access to sufficient liquidity, which includes all of the borrowing capacity available to draw against our ~~recently-amended and restated~~ $1.5 billion revolving credit facility, ~~(see Note 18 — Subsequent Event in Part I, Item 1 ‘Financial Statements’ in this Quarterly Report on Form 10-Q for further information),~~ to meet our cash needs for the next twelve months, including investments in the business for growth, scheduled debt repayments, share repurchases and dividend payments. During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, we made payments of $185 million (net of reimbursements) for the settlement of obligations related to the Stanford and Willis Towers Watson merger-related securities litigations, and we repaid in full the $450 million of 3.500% senior notes which matured in the third quarter of 2021 and the $500 million of 5.750% senior notes which matured in the first quarter of 2021, along with the respective related interest, using currently available cash. During the third quarter of 2021 we also restarted our share repurchase programs and repurchased $1$2.3 billion of ~~stock,~~shares, and have authorization to repurchase an additional $1.6 billion. Additionally, we intend to refinance our €540 million ($609 million) of 2.125% senior notes, which mature during the second quarter 2022. The timing, tenor, currency and size of such a ~~further $4.5 billion.~~refinancing will be determined based on market conditions.

~~Additionally,~~From time to time, we will consider whether to repurchase shares based on many factors, including market and economic conditions, applicable legal requirements and other business considerations. The share repurchase program has no termination date and may be suspended or discontinued at any time.

During the prior year, the operating results and balance sheets of Willis Re were reclassified to discontinued ~~operations during the quarter. Willis Re’s cash balances at September 30, 2021 and December 31, 2020 were $53 million and $50 million, respectively.~~operations. Willis Re’s operating cash flows approximate its pre-tax income and any adjustments for working capital movements (see Note 3 — Acquisitions and Divestitures in Part I, Item 1 ~~‘Financial~~‘Financial Statements’ inwithin this Quarterly Report on Form 10-Q ~~for further information),~~). Certain costs historically allocated to the Willis Re business are included in continuing operations and iswere retained following the disposal, but are expected to be partially offset by reimbursements through ~~a Transition Services Agreement.~~the TSA. Costs incurred to service the TSA are expected to be reduced as part of the Company’s Transformation program as quickly as possible when the services are no longer required by Gallagher.

Events that could change the historical cash flow dynamics discussed above include significant changes in operating results, potential future acquisitions or divestitures, material changes in geographic sources of cash, unexpected adverse impacts from litigation or regulatory matters, or future pension funding during periods of severe downturn in the capital markets.

Undistributed Earnings of Foreign Subsidiaries

We continue to have certain subsidiaries whose earnings have not been deemed permanently reinvested, for which we have been accruing estimates of the tax effects of such repatriation. In addition, in connection with the Willis Re divestiture, we have recorded an estimated deferred tax expense for certain Willis Re subsidiaries whose outside basis differences are no longer considered indefinitely reinvested. Excluding these certain subsidiaries, we continue to assert that the historical cumulative earnings for the remainder of our subsidiaries have been reinvested indefinitely, and therefore do not provide deferred taxes on these amounts. If future events, including material changes in estimates of cash, working capital, long-term investment requirements or additional legislation relating to U.S. Tax Reform, necessitate that these earnings be distributed, an additional provision for income and foreign withholding taxes, net of credits, may be necessary. Other potential sources of cash may be through the settlement of intercompany loans or return of capital distributions in a tax-efficient manner.

Cash and Cash Equivalents

Our cash and cash equivalents ~~(including the cash balances of Willis Re)~~ at ~~September 30, 2021~~March 31, 2022 totaled $2.2 billion, compared to ~~$2.0~~$4.5 billion at December 31, ~~2020.~~2021. The ~~increase~~decrease in cash from December 31, ~~2020~~2021 to ~~September 30, 2021~~March 31, 2022 was due primarily ~~due~~ to the $1 billion income receipt related to the termination of the proposed Aon transaction and the net proceeds from the sale of our Miller business in the amount of $696 million along with strong operating results. However, the $1$2.3 billion of income receipt was offset by stock repurchases made during the third quarter of 2021 in the same amount. These additions to cash were further partially offset by the payments in full of our $450 million of 3.500% senior notes, $500 million of 5.750% senior notes, net legal settlement payments of $185 million (related to the Stanford and Willis Towers Watson merger settlements), and higher bonus payments and benefit-related items of $189 million made in the first half of 2021.share repurchases.

Additionally, we had all of the borrowing capacity available to draw against our ~~then-current $1.25~~$1.5 billion revolving credit facility at both ~~September 30, 2021~~March 31, 2022 and December 31, 2020. The facility was replaced on October 6, 2021 and we now have borrowing capacity of $1.5 billion under the new revolving credit facility. See Note 18 – Subsequent Event within Item 1 of this Quarterly Report on Form 10-Q for further information on the new revolving credit facility.2021.

Included within cash and cash equivalents at ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~ 2021 are amounts held for regulatory capital adequacy requirements, including ~~$120~~$119 million and $88$120 million, respectively, held within our regulated U.K. entities.

Summarized Condensed Consolidated Cash Flows

The following table presents the summarized condensed consolidated cash flow information for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 and ~~2020:~~2021:


	Three Months Ended March 31,
	2022			2021
	(in millions)
Net cash from/(used in):
Operating activities	$	21		$	(128	)
Investing activities		74			429
Financing activities		(2,580	)		(832	)
DECREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH (i)		(2,485	)		(531	)
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(34	)		(60	)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD (i)		7,691			6,301
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (i)	$	5,172		$	5,710

Nine Months Ended September 30,

2021

2020

(in millions)

Net cash from/(used in):

Operating activities

$
1,877

$
1,206

Investing activities

577

(108
)
Financing activities

(2,305
)

(334
)
INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED
CASH

149

764

Effect of exchange rate changes on cash, cash equivalents and restricted cash

(24
)

(5
)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD ⁽ⁱ⁾

2,096

895

CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD ⁽ⁱ⁾

$
2,221

$
1,654

(i)

The amounts of cash, cash equivalents and restricted cash, their respective classification on the condensed consolidated balance sheets, as well as their respective portions of the increase or decrease in cash, cash equivalents and restricted cash for each of the periods presented have been included in Note 19 — Supplemental Disclosures of Cash Flow Information within Part I, Item I ‘Financial Statements’ within this Quarterly Report on Form 10-Q.

~~(i)~~

Cash, cash equivalents and restricted cash included $6 million, $7 million, $7 million and $8 million of restricted cash at September 30, 2021, December 31, 2020, September 30, 2020 and December 31, 2019, respectively, which is included within prepaid and other current assets on our condensed consolidated balance sheets. Additionally, cash, cash equivalents and restricted cash included $53 million, $50 million, $56 million and $56 million of cash attributable to discontinued operations at September 30, 2021, December 31, 2020, September 30, 2020 and December 31, 2019, respectively, which is included within assets held for sale on our condensed consolidated balance sheets.

Cash Flows ~~From~~From/(Used In) Operating Activities

Cash flows from operating activities were ~~$1.9 billion~~$21 million for the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, compared to ~~$1.2 billion~~cash flows used in operating activities of $128 million for the ~~nine~~three months ended ~~September 30, 2020.~~March 31, 2021. The ~~$1.9 billion~~$21 million of net cash ~~from~~used in operating activities for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 included net income of ~~$1.8 billion~~$125 million and ~~$200~~$281 million of favorable non-cash adjustments, partially offset by unfavorable changes in operating assets and liabilities of ~~$152~~$385 million. This increase in cash flows from ~~operating activities~~operations as compared to the prior year was primarily due ~~the $1 billion of income receipt related~~ to the ~~termination~~absence of the ~~proposed Aon transaction partially offset by~~ net legal

settlement payments of $185 million ~~as well as $189 million of increased~~made last year, partially offset by higher bonus payments and ~~benefit-related payments made during~~lower reinsurance-related cash collections in the ~~nine months ended September 30, 2021.~~current quarter.

The ~~$1.2 billion~~$128 million of net cash ~~from~~used in operating activities for the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 included net income of ~~$537~~$736 million, ~~and $582~~offset by $171 million of unfavorable non-cash adjustments ~~as wells as favorable~~and by unfavorable changes in operating assets and liabilities of ~~$87~~$693 million.

Cash Flows ~~From/(Used In)~~From Investing Activities

Cash flows from investing activities for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 were ~~$577~~$74 million as compared to ~~cash flows used in investing activities of $108~~$429 million for the ~~nine~~three months ended ~~September 30, 2020.~~March 31, 2021. The cash flows from investing activities for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 primarily include sales of investments of $200 million, partially offset by capital expenditures and capitalized software additions of $46 million and an acquisition of $68 million made during the first quarter of 2022. The cash flows from investing activities in the prior year period primarily included the net proceeds from the sale of Miller of $696 million, ~~and another smaller sale of $30 million,~~ partially offset by cash and fiduciary funds transferred on disposal of $216 million and capital expenditures and capitalized software additions of ~~$149~~$51 million.

~~The cash flows used in investing activities in the prior year period were primarily driven by capital expenditures, capitalized software additionsand an acquisition during the first quarter of 2020.~~

Cash Flows Used In Financing Activities

Cash flows used in financing activities for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 were ~~$2.3~~$2.6 billion. The significant financing activities included share repurchases of ~~$1.0~~$2.3 billion, ~~debt repayments~~$211 million of ~~$970 million along with~~net payments from fiduciary funds held for clients and dividend payments of ~~$275~~$98 million.

Cash flows used in financing activities for the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 were ~~$334~~$832 million. The significant financing activities included the full payment of our $500 million of 5.750% senior notes, $199 million of net payments from fiduciary funds held for clients and dividend payments of ~~$259 million and net debt-related payments of $39~~$92 million.

~~Indebtedness~~37

Indebtedness

Total debt, total equity, and the capitalization ratios at ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021 were as follows:


	September 30, 2021			December 31, 2020			March 31, 2022			December 31, 2021
	($ in millions)						($ in millions)
Long-term debt	$	3,993		$	4,664		$	3,975		$	3,974
Current debt		644			971			599			613
Total debt	$	4,637		$	5,635		$	4,574		$	4,587

Total Willis Towers Watson shareholders’ equity	$	11,393		$	10,820
Total WTW shareholders’ equity							$	11,004		$	13,260

Capitalization ratio		28.9	%		34.2	%		29.4	%		25.7	%

The capitalization ratio ~~decreased~~increased from December 31, ~~2020~~2021 primarily due to ~~the August 2021 repayment of our $450 million 3.500% senior notes and March 2021 repayment of our~~ ~~$500 million 5.750% senior notes (see Note 9 — Debt in Part I, Item 1 ‘Financial Statements’~~ ~~in this Quarterly Report on Form 10-Q~~ ~~for further information),~~ as well as the increase in shareholders’ equity driven by strong earnings during the first nine months of the year, which included the gain on the Miller wholesale business and the income receipt related to the termination of the proposed Aon transaction, partially offset by $1.0$2.3 billion of share repurchases. during the three months ended March 31, 2022.

At ~~September 30, 2021,~~March 31, 2022, our mandatory debt ~~repayments~~repayment over the next twelve months ~~include $626~~includes $599 million outstanding on our Euro-denominated 2.125% senior notes due ~~2022 and $19 million outstanding on our collateralized facility. In addition, our $1.25 billion revolving credit facility was set to expire on~~2022.

At March 7,31, 2022 but was replaced on October 6, 2021 by our recently-amended and restated $1.5 billion revolving credit facility (see Note 18 — Subsequent Event in Part I, Item 1 ‘Financial Statements’ in this Quarterly Report on Form 10-Q for further information).

~~At September 30, 2021~~ and December 31, ~~2020~~2021, we were in compliance with all financial covenants.

Fiduciary Funds

As an intermediary, we hold funds, generally in a fiduciary capacity, for the account of third parties, typically as the result of premiums received from clients that are in transit to insurers and claims due to clients that are in transit from insurers. We ~~report premiums, which~~also hold funds for clients of our benefits account businesses. These fiduciary funds are ~~held on account of, or due from, clients as~~included in fiduciary assets ~~with a corresponding liability due to the insurers. Claims held by or due to us, which are due to clients, are also shown as both Fiduciary assets and Fiduciary liabilities~~ on our condensed consolidated balance sheets. We present the equal and corresponding fiduciary liabilities related to these fiduciary funds representing amounts or claims due to our clients or premiums due on their behalf to insurers on our condensed consolidated balance sheets.

Fiduciary funds are generally required to be kept in regulated bank accounts subject to guidelines which emphasize capital preservation and liquidity; such funds are not available to service the Company’s debt or for other corporate purposes.

Notwithstanding the legal relationships with clients and insurers, the Company is entitled to retain investment income earned on certain of these fiduciary funds in accordance with industry custom and practice and, in some cases, as supported by agreements with insureds.

At ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, we had fiduciary funds of ~~$4.1~~$3.1 billion and ~~$4.3~~$3.4 billion, respectively, of which ~~$2.5 billion at both balance sheet dates presented~~$616 million and $719 million, respectively, are attributable to our Willis Re business.

Share Repurchase Program

The Company is authorized to repurchase shares, by way of redemption or otherwise, and will consider whether to do so from time to time, based on many factors, including market conditions. There are no expiration dates for our repurchase plans or programs.

On February 26, 2020, the board of directors approved a $251 million increase to the existing share repurchase program. On July 26, 2021, the board of directors approved a $1.0 billion increase to the existing share repurchase program, and on September 16, 2021, approved a $4.0 billion increase to the existing share repurchase program. These three increases brought the total approved authorization to $5.5 billion.

At ~~September 30, 2021,~~March 31, 2022, approximately ~~$4.5~~$1.6 billion remained on the current repurchase authority. The maximum number of shares that could be repurchased based on the closing price of our ordinary shares on ~~September 30, 2021~~March 31, 2022 of ~~$232.46~~$236.22 was ~~19,358,169.~~6,869,233.

During the three ~~and nine~~ months ended ~~September 30, 2021,~~March 31, 2022, the Company had the following share repurchase ~~activity~~:activity:

Three Months Ended
September 30, 2021

Nine Months Ended
September 30, 2021

Shares repurchased

4,455,544

4,455,544

Average price per share

$224.44

$224.44

Aggregate repurchase cost (excluding broker costs)

$1.0 billion

$1.0 billion


	Three Months Ended March 31, 2022
Shares repurchased		9,860,414
Average price per share	$228.19
Aggregate repurchase cost (excluding broker costs)	$2.3 billion

During the first half of 2021, the Company had no share repurchase activity. A share repurchase prohibition existed under the transaction agreement for the proposed Aon combination. Following the Termination, there are no longer any contractual prohibitions on share repurchases.

Capital Commitments

Capital expenditures for fixed assets and software for internal use were ~~$109~~$31 million during the ~~nine~~three months ended ~~September 30, 2021.~~March 31, 2022. The Company estimates that there will be additional such expenditures, which includes those incurred under its Transformation program, in the range of ~~approximately $61~~$160 million - $210 million during the remainder of ~~2021.~~2022. We currently expect cash from operations to adequately provide for these cash needs. There have been no material changes to our capital commitments since December 31, ~~2020.~~2021.

Dividends

Total cash dividends of ~~$275~~$98 million were paid during the ~~nine~~three months ended ~~September 30, 2021.~~March 31, 2022. In ~~July 2021,~~February 2022, the board of directors approved ~~an increased~~a quarterly cash dividend of ~~$0.80~~$0.82 per share ($~~3.20~~3.28 per share annualized rate), which was paid on ~~October~~April 15, ~~2021~~2022 to shareholders of record as of ~~September 30, 2021.~~March 31, 2022.

Supplemental Guarantor Financial Information

As of ~~September 30, 2021, Willis Towers Watson~~March 31, 2022, WTW has issued the following debt securities (the ‘notes’):

Willis North America Inc. (‘Willis North America’) has approximately $2.9 billion senior notes outstanding, of which $650 million were issued on May 16, 2017, $1.0 billion were issued on September 10, 2018, $1.0 billion were issued on September 10, 2019, and $275 million were issued on May 29, 2020; and

Trinity Acquisition plc has approximately $1.7 billion senior notes outstanding, of which $525 million were issued on August 15, 2013, $550 million were issued on March 22, 2016 and €540 million ($609 million) were issued on May 26, 2016, and a $1.25 billion revolving credit facility established on March 7, 2017, on which no balance is currently outstanding.

Trinity Acquisition plc has approximately $1.7 billion senior notes outstanding, of which $525 million were issued on August 15, 2013, $550 million were issued on March 22, 2016 and €540 million ($609 million) were issued on May 26, 2016, and a $1.5 billion revolving credit facility, on which no balance was outstanding at March 31, 2022.

The following table presents a summary of the entities that issue each note and those wholly-owned subsidiaries of the Company that guarantee each respective note on a joint and several basis as of ~~September 30, 2021.~~March 31, 2022. These subsidiaries are all consolidated by Willis Towers Watson plc (the ‘parent company’) and together with the parent company comprise the ‘Obligor group’.


Entity	Trinity Acquisition plc Notes	Willis North America Inc. Notes
Willis Towers Watson plc⁽ⁱ⁾	Guarantor	Guarantor
Trinity Acquisition plc	Issuer	Guarantor
Willis North America Inc.	Guarantor	Issuer
Willis Netherlands Holdings B.V.	Guarantor	Guarantor
Willis Investment UK Holdings Limited	Guarantor	Guarantor
TA I Limited	Guarantor	Guarantor
Willis Group Limited	Guarantor	Guarantor
Willis Towers Watson Sub Holdings Unlimited Company	Guarantor	Guarantor
Willis Towers Watson UK Holdings Limited	Guarantor	Guarantor

~~(i)The $500 million senior notes issued on March 17, 2011 by Willis Towers Watson plc, and related interest, were fully repaid on March 15, 2021.~~

The notes issued by Willis North America and Trinity Acquisition plc:

•

rank equally with all of the issuer’s existing and future unsubordinated and unsecured debt;

•

rank equally with the issuer’s guarantee of all of the existing senior debt of the Company and the other guarantors, including any debt under the Revolving Credit Facility;

•

are senior in right of payment to all of the issuer’s future subordinated debt; and

•

are effectively subordinated to all of the issuer’s secured debt to the extent of the value of the assets securing such debt.

•

~~rank equally with all of the issuer’s existing and future unsubordinated and unsecured debt;~~

•

~~rank equally with the issuer’s guarantee of all of the existing senior debt of the Company and the other guarantors, including any debt under the Revolving Credit Facility;~~

•

~~are senior in right of payment to all of the issuer’s future subordinated debt; and~~

•

~~are effectively subordinated to all of the issuer’s secured debt to the extent of the value of the assets securing such debt.~~

All other subsidiaries of the parent company are non-guarantor subsidiaries (‘the non-guarantor subsidiaries’).

Each member of the Obligor group has only a stockholder’s claim on the assets of the non-guarantor subsidiaries. This stockholder’s claim is junior to the claims that creditors have against those non-guarantor subsidiaries. Holders of the notes will only be creditors of

the Obligor group and not creditors of the non-guarantor subsidiaries. As a result, all of the existing and future liabilities of the non-guarantor subsidiaries, including any claims of trade creditors and preferred stockholders, will be structurally senior to the notes. As of and for the periods ended ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the non-guarantor subsidiaries represented substantially all of the total assets and accounted for substantially all of the total revenue of the Company prior to consolidating adjustments. The non-guarantor subsidiaries have other liabilities, including contingent liabilities that may be significant. Each indenture does not contain any limitations on the amount of additional debt that the Obligor group and the non-guarantor subsidiaries may incur. The amounts of this debt could be substantial, and this debt may be debt of the non-guarantor subsidiaries, in which case this debt would be effectively senior in right of payment to the notes.

The notes are obligations exclusively of the Obligor group. Substantially all of the Obligor group’s operations are conducted through its non-guarantor subsidiaries. Therefore, the Obligor group’s ability to service its debt, including the notes, is dependent upon the net cash flows of its non-guarantor subsidiaries and their ability to distribute those net cash flows as dividends, loans or other payments to the Obligor group. Certain laws restrict the ability of these non-guarantor subsidiaries to pay dividends and make loans and advances to the Obligor group. In addition, such non-guarantor subsidiaries may enter into contractual arrangements that limit their ability to pay dividends and make loans and advances to the Obligor group.

Intercompany balances and transactions between members of the Obligor group have been eliminated. All intercompany balances and transactions between the Obligor group and the non-guarantor subsidiaries have been presented in the disclosures below on a net presentation basis, rather than a gross basis, as this better reflects the nature of the intercompany positions and presents the funding or funded position that is to be received or owed. The intercompany balances and transactions between the Obligor group and non-guarantor subsidiaries, presented below, relate to a number of items including loan funding for acquisitions and other purposes, transfers of surplus cash between subsidiary companies, funding provided for working capital purposes, settlement of expense accounts, transactions related to share-based payment arrangements and share issuances, intercompany royalty arrangements, intercompany dividends and intercompany interest. At ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the intercompany balances of the Obligor group with non-guarantor subsidiaries were net receivables of ~~$500~~$700 million at both balance sheet dates presented and net payables of ~~$8.3~~$10.6 billion and ~~$7.6~~$8.1 billion, respectively.

No balances or transactions of non-guarantor subsidiaries are presented in the disclosures other than the intercompany items noted above.

Presented below is certain summarized financial information for the Obligor group.

`

As of
September 30, 2021

As of
December 31, 2020

(in millions)

Total current assets

$
201

$
161

Total non-current assets

676

671

Total current liabilities

6,850

5,116

Total non-current liabilities

6,551

8,434

Nine months ended
September 30, 2021

(in millions)

Revenue

$
246

Income from operations

1,027

Income from operations before income taxes ⁽ⁱ⁾

969

Net income

847

Net income attributable to Willis Towers Watson

847

~~(i)~~


`	As of March 31, 2022		As of December 31, 2021
	(in millions)
Total current assets	$	152	$	243
Total non-current assets		833		862
Total current liabilities		9,216		7,747
Total non-current liabilities		6,289		5,298


	Three months ended March 31, 2022
	(in millions)
Revenue	$	42
Loss from operations		(23	)
Loss from operations before income taxes (i)		(132	)
Net loss		(117	)
Net loss attributable to WTW		(117	)

(i)

Includes intercompany expense, net of the Obligor group from non-guarantor subsidiaries of ~~$45~~$35 million for the ~~nine~~three months ended ~~September 30, 2021.~~March 31, 2022.

Non-GAAP Financial Measures

In order to assist readers of our condensed consolidated financial statements in understanding the core operating results that ~~Willis Towers Watson’s~~WTW’s management uses to evaluate the business and for financial planning purposes, we present the following non-GAAP measures and their most directly comparable U.S. GAAP measure:


Most Directly Comparable U.S. GAAP Measure		Non-GAAP Measure
As reported change		Constant currency change
As reported change		Organic change
Income from operations/margin		Adjusted operating income/margin
Net income/margin		Adjusted EBITDA/margin
Net income attributable to ~~Willis Towers Watson~~WTW		Adjusted net income
Diluted earnings per share		Adjusted diluted earnings per share
Income from continuing operations before income taxes		Adjusted income before taxes
Provision for income taxes/U.S. GAAP tax rate		Adjusted income taxes/tax rate
Net cash from operating activities		Free cash flow

The Company believes that these measures are relevant and provide ~~useful~~pertinent information widely used by analysts, investors and other interested parties in our industry to provide a baseline for evaluating and comparing our operating performance, and in the case of free cash flow, our liquidity results.

Within the measures referred to as ‘adjusted’, we adjust for significant items which will not be settled in cash, or which we believe to be items that are not core to our current or future operations. Some of these items may not be applicable for the current quarter, however they may be part of our full-year results. These items include the following:

•

Income from discontinued operations, net of tax – Adjustment to remove the after-tax income from discontinued operations and the after-tax gain attributable to the divestiture of our Willis Re business.

•

Restructuring costs and transaction and transformation, net – Management believes it is appropriate to adjust for restructuring costs and transaction and transformation, net when they relate to a specific significant program with a defined set of activities and costs that are not expected to continue beyond a defined period of time, or significant acquisition-related transaction expenses. We believe the adjustment is necessary to present how the Company is performing, both now and in the future when the incurrence of these costs will have concluded.

•

Impairment – Adjustment to remove the impairment related to the net assets of our Russian business that are held outside of our Russian entities.

•

Gains and losses on disposals of operations – Adjustment to remove the gains or losses resulting from disposed operations that have not been classified as discontinued operations.

•

Pension settlement and curtailment gains and losses – Adjustment to remove significant pension settlement and curtailment gains and losses to better present how the Company is performing.

•

Provisions for significant litigation – We will include provisions for litigation matters which we believe are not representative of our core business operations. These amounts are presented net of insurance and other recovery receivables.

•

Tax effect of the Coronavirus Aid, Relief, and Economic Security (‘CARES’) Act – Relates to the incremental tax expense impact, primarily from the Base Erosion and Anti-Abuse Tax (‘BEAT’), generated from electing certain income tax provisions of the CARES Act.

•

Tax effects of internal reorganizations – Relates to the U.S. income tax expense resulting from the completion of internal reorganizations of the ownership of certain businesses that reduced the investments held by our U.S.-controlled subsidiaries.

•

Restructuring costs and transaction and integration, net – Management believes it is appropriate to adjust for restructuring costs and transaction and integration, net when they relate to a specific significant program with a defined set of activities and costs that are not expected to continue beyond a defined period of time, or significant acquisition-related transaction expenses. We believe the adjustment is necessary to present how the Company is performing, both now and in the future when the incurrence of these costs will have concluded. Transaction and integration, net in 2021 includes the income receipt related to the termination of the proposed Aon transaction.

•

~~Gains and losses on disposals of operations – Adjustment to remove the gain or loss resulting from disposed operations.~~

•

~~Pension settlement and curtailment gains and losses – Adjustment to remove significant pension settlement and curtailment gains and losses to better present how the Company is performing.~~

•

~~Abandonment of long-lived asset – Adjustment to remove the depreciation expense resulting from internally-developed software that was abandoned prior to being placed into service.~~

•

~~Tax effect of statutory rate changes – Relates to the incremental tax expense or benefit from significant statutory income tax rate changes enacted in material jurisdictions in which we operate.~~

•

Tax effect of the CARES Act – Relates to the incremental tax expense impact, primarily from the Base Erosion and Anti-Abuse Tax (‘BEAT’), generated from electing certain income tax provisions of the CARES Act.

•

Tax effects of internal reorganization – Relates to the U.S. income tax expense resulting from the completion of internal reorganizations of the ownership of certain businesses that reduced the investments held by our U.S.-controlled subsidiaries.

These non-GAAP measures are not defined in the same manner by all companies and may not be comparable to other similarly titled measures of other companies. Non-GAAP measures should be considered in addition to, and not as a substitute for, the information contained within our condensed consolidated financial statements.

For all prior-year period financial information presented herein (with the exception of Free Cash Flow), the operating results of Willis Re have been reclassified as discontinued operations (see Note 3 –— Acquisitions and Divestitures inwithin Part I, Item 1 ‘Financial Statements’ in this Form 10-Q for additional ~~information)~~information).

Constant Currency Change and Organic Change

We evaluate our revenue on an as reported (U.S. GAAP), constant currency and organic basis. We believe presenting constant currency and organic information provides valuable supplemental information regarding our comparable results, consistent with how we evaluate our performance internally.

•

Constant currency change - Represents the year-over-year change in revenue excluding the impact of foreign currency fluctuations. To calculate this impact, the prior year local currency results are first translated using the current year monthly average exchange rates. The change is calculated by comparing the prior year revenue, translated at the current year monthly average exchange rates, to the current year as reported revenue, for the same period. We believe constant currency measures provide useful information to investors because they provide transparency to performance by excluding the effects that foreign currency exchange rate fluctuations have on period-over-period comparability given volatility in foreign currency exchange markets.

•

Organic change - Excludes the impact of fluctuations in foreign currency exchange rates as described above and the period-over-period impact of acquisitions and divestitures on current-year revenue. We believe that excluding transaction-related items from our U.S. GAAP financial measures provides useful supplemental information to our investors, and it is important in illustrating what our core operating results would have been had we not included these transaction-related items, since the nature, size and number of these transaction-related items can vary from period to period.

•

~~Constant currency change~~ – Represents the year-over-year change in revenue excluding the impact of foreign currency fluctuations. To calculate this impact, the prior year local currency results are first translated using the current year monthly average exchange rates. The change is calculated by comparing the prior year revenue, translated at the current year monthly average exchange rates, to the current year as reported revenue, for the same period. We believe constant currency measures provide useful information to investors because they provide transparency to performance by excluding the effects that foreign currency exchange rate fluctuations have on period-over-period comparability given volatility in foreign currency exchange markets.

•

~~Organic change~~ – Excludes the impact of fluctuations in foreign currency exchange rates as described above and the period-over-period impact of acquisitions and divestitures on current-year revenue. We believe that excluding transaction-related items from our U.S. GAAP financial measures provides useful supplemental information to our investors, and it is important in illustrating what our core operating results would have been had we not included these transaction-related items, since the nature, size and number of these transaction-related items can vary from period to period.

The constant currency and organic change results, and ~~reconciliations~~a reconciliation from the reported results for consolidated revenue are included in the ~~Consolidated~~‘Consolidated Revenue (Continuing Operations)’ section within this Form 10-Q. These measures are also reported by segment in the ~~Segment Revenue~~‘Segment Revenue’ section within this Form 10-Q.

~~Reconciliations~~A reconciliation of the reported changes to the constant currency and organic changes for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 from the three ~~and nine~~ months ended ~~September 30, 2020 are~~March 31, 2021 is as ~~follows:~~follows. Note: the components of revenue change may not add due to rounding.

Components of Revenue Change⁽ⁱ⁾

As

Constant

Nine Months Ended September 30,

Reported

Currency

Currency

Acquisitions/

Organic

2021

2020

Change

Impact

Change

Divestitures

Change

($ in millions)

Revenue ⁽ⁱⁱ⁾

$
6,292

$
5,946

6%

3%

3%

(4)%

6%

Components of Revenue Change

Less:

Constant

Less:

Three Months Ended March 31,

Reported

Currency

Acquisitions/

Organic

2022

2021

Change

Impact

Change

Divestitures

Change

($ in millions)

Revenue

2,160

2,228

(3)%

(2)%

(1)%

(2)%

~~(i)~~

~~Components of revenue change may not add due to rounding.~~

~~(ii)~~

~~Excludes revenue (reclassified as discontinued operations) associated with our Willis Re business.~~

Adjusting for the impacts of foreign currency and acquisitions and disposals in the calculation of our organic activity, our revenue ~~growth was 7%~~grew by 2% for the three months ended ~~September 30, 2021 and 6% for the nine months ended September 30, 2021.~~March 31, 2022. The ~~increases to our~~increase in organic revenue ~~for both the current and prior-year periods were~~was driven by ~~strong performances in all segments.~~our HWC segment.

Adjusted Operating Income/Margin

We consider adjusted operating income/margin to be important financial measures, which are used internally to evaluate and assess our core operations and to benchmark our operating results against our competitors.

Adjusted operating income is defined as income from operations adjusted for impairment, amortization, restructuring costs, transaction and ~~integration,~~transformation, net and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results. Adjusted operating income margin is calculated by dividing adjusted operating income by revenue.

Reconciliations of income from operations to adjusted operating income for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ are as follows:


	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended March 31,
	2021			2020			2021			2020			2022			2021
	(in millions)												(in millions)
Income from operations	$	1,131		$	66		$	1,512		$	280		$	179		$	211
Adjusted for certain items:
Abandonment of long-lived asset		—			—			—			35
Impairment														81			—
Amortization		85			108			285			347			85			103
Transaction and integration, net		(952	)		42			(877	)		65
Provision for significant litigation		—			15			—			15
Restructuring costs														6			—
Transaction and transformation, net														20			24
Adjusted operating income	$	264		$	231		$	920		$	742		$	371		$	338

Income from operations margin		57.3	%		3.5	%		24.0	%		4.7	%		8.3	%		9.5	%
Adjusted operating income margin		13.4	%		12.2	%		14.6	%		12.5	%		17.2	%		15.2	%

Adjusted operating income increased for the three months ended ~~September 30, 2021~~March 31, 2022 to ~~$264~~$371 million, from ~~$231~~$338 million for the three months ended ~~September 30, 2020~~March 31, 2021. This increase was primarily due to lower salary and ~~increased for~~benefits costs in the ~~nine months ended September 30, 2021 to $920 million from $742 million for the nine months ended September 30, 2020.~~ ~~These increases resulted mostly from higher~~current quarter, partially offset by lower revenue.

Adjusted EBITDA/Margin

We consider adjusted EBITDA/margin to be important financial measures, which are used internally to evaluate and assess our core operations, to benchmark our operating results against our competitors and to evaluate and measure our performance-based compensation plans.

Adjusted EBITDA is defined as net income adjusted for ~~loss/(income)~~income from discontinued operations, net of tax, provision for income taxes, interest expense, impairment, depreciation and amortization, restructuring costs, transaction and ~~integration,~~transformation, net, gains and losses on disposals of operations and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results. Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by revenue.

Reconciliations of net income to adjusted EBITDA for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ are as follows:


	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended March 31,
	2021			2020			2021			2020			2022			2021
	(in millions)												(in millions)
NET INCOME	$	907		$	122		$	1,829		$	537		$	125		$	736
Loss/(income) from discontinued operations, net of tax		12			(3	)		(247	)		(253	)
Income from discontinued operations, net of tax														(11	)		(190	)
Provision for income taxes		267			42			386			133			43			44
Interest expense		50			61			161			184			49			59
Depreciation ⁽ⁱ⁾		69			73			212			237
Impairment														81			—
Depreciation														66			71
Amortization		85			108			285			347			85			103
Transaction and integration, net		(952	)		42			(877	)		65
Provision for significant litigation		—			15			—			15
Gain on disposal of operations		(23	)		(85	)		(380	)		(83	)
Restructuring costs														6			—
Transaction and transformation, net														20			24
Loss/(gain) on disposal of operations														54			(359	)
Adjusted EBITDA	$	415		$	375		$	1,369		$	1,182		$	518		$	488

Net income margin		46.0	%		6.4	%		29.1	%		9.0	%		5.8	%		33.0	%
Adjusted EBITDA margin		21.0	%		19.8	%		21.8	%		19.9	%		24.0	%		21.9	%

~~(i)~~

~~Includes abandonment of long-lived asset of $35 million for the nine months ended September 30, 2020.~~

Adjusted EBITDA for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$415~~$518 million, compared to ~~$375~~$488 million for the three months ended ~~September 30, 2020, and~~March 31, 2021. This increase was ~~$1.4 billion for the nine months ended September 30, 2021, compared to $1.2 billion for the nine months ended September 30, 2020.~~ ~~These increases were~~ primarily due to ~~higher~~lower salary and benefits costs in the current quarter, partially offset by lower revenue.

Adjusted Net Income and Adjusted Diluted Earnings Per Share

Adjusted net income is defined as net income attributable to ~~Willis Towers Watson~~WTW adjusted for ~~loss/(income)~~income from discontinued operations, net of tax, impairment, amortization, restructuring costs, transaction and ~~integration,~~transformation, net, gains and losses on disposals of operations and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results and the related tax effect of those adjustments and the tax effects of internal reorganizations. This measure is used solely for the purpose of calculating adjusted diluted earnings per share.

Adjusted diluted earnings per share is defined as adjusted net income divided by the weighted-average number of shares of common stock, diluted. Adjusted diluted earnings per share is used to internally evaluate and assess our core operations and to benchmark our operating results against our competitors.

Reconciliations of net income attributable to ~~Willis Towers Watson~~WTW to adjusted diluted earnings per share for thethree months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ are as follows:

Three Months Ended September 30,

2021

2020

($ in millions)

NET INCOME ATTRIBUTABLE TO WILLIS TOWERS WATSON

$
903

$
121

Adjusted for certain items:

Loss/(income) from discontinued operations, net of tax

12

(3
)
Amortization

85

108

Transaction and integration, net

(952
)

42

Provision for significant litigation

—

15

Gain on disposal of operations

(23
)

(85
)
Tax effect on certain items listed above ⁽ⁱ⁾

199

(31
)
Tax effect of the CARES Act

—

3

Adjusted net income

$
224

$
170

Weighted-average shares of common stock — diluted

129

130

Diluted earnings per share

$
6.99

$
0.93

Adjusted for certain items ⁽ⁱⁱ⁾:

Loss/(income) from discontinued operations, net of tax

0.09

(0.02
)
Amortization

0.66

0.83

Transaction and integration, net

(7.37
)

0.32

Provision for significant litigation

—

0.12

Gain on disposal of operations

(0.18
)

(0.65
)
Tax effect on certain items listed above ⁽ⁱ⁾

1.54

(0.24
)
Tax effect of the CARES Act

—

0.02

Adjusted diluted earnings per share

$
1.73

$
1.31

~~(i)~~

~~The tax effect was calculated using an effective tax rate for each item.~~

~~(ii)~~

~~Per share values and totals may differ due to rounding.~~

~~Reconciliations of net income attributable to Willis Towers Watson to adjusted diluted earnings per share for the~~ ~~nine months ended September 30, 2021~~


	Three Months Ended March 31,
	2022			2021
	($ in millions)
NET INCOME ATTRIBUTABLE TO WTW	$	122		$	733
Adjusted for certain items:
Income from discontinued operations, net of tax		(11	)		(190	)
Impairment		81			—
Amortization		85			103
Restructuring costs		6			—
Transaction and transformation, net		20			24
Loss/(gain) on disposal of operations		54			(359	)
Tax effect on certain items listed above (i)		(42	)		(27	)
Adjusted net income	$	315		$	284

Weighted-average shares of common stock — diluted		118			130

Diluted earnings per share	$	1.03		$	5.63
Adjusted for certain items (ii) :
Income from discontinued operations, net of tax		(0.09	)		(1.46	)
Impairment		0.68			—
Amortization		0.72			0.79
Restructuring costs		0.05			—
Transaction and transformation, net		0.17			0.18
Loss/(gain) on disposal of operations		0.46			(2.76	)
Tax effect on certain items listed above (i)		(0.36	)		(0.21	)
Adjusted diluted earnings per share	$	2.66		$	2.18

(i)

The tax effect was calculated using an effective tax rate for each item.

(ii)

Per share values and ~~2020 are as follows:~~

Nine Months Ended September 30,

2021

2020

($ in millions)

NET INCOME ATTRIBUTABLE TO WILLIS TOWERS WATSON

$
1,820

$
520

Adjusted for certain items:

Income from discontinued operations, net of tax

(247
)

(253
)
Abandonment of long-lived asset

—

35

Amortization

285

347

Transaction and integration, net

(877
)

65

Provision for significant litigation

—

15

Gain on disposal of operations

(380
)

(83
)
Tax effect on certain items listed above ⁽ⁱ⁾

144

(96
)
Tax effect of statutory rate change

40

—

Tax effect of the CARES Act

—

38

Adjusted net income

$
785

$
588

Weighted-average shares of common stock — diluted

130

130

Diluted earnings per share

$
14.00

$
3.99

Adjusted for certain items ⁽ⁱⁱ⁾:

Income from discontinued operations, net of tax

(1.90
)

(1.95
)
Abandonment of long-lived asset

—

0.27

Amortization

2.19

2.66

Transaction and integration, net

(6.75
)

0.50

Provision for significant litigation

—

0.12

Gain on disposal of operations

(2.92
)

(0.64
)
Tax effect on certain items listed above ⁽ⁱ⁾

1.11

(0.74
)
Tax effect of statutory rate change

0.31

—

Tax effect of the CARES Act

—

0.29

Adjusted diluted earnings per share

$
6.04

$
4.52

totals may differ due to rounding.

~~(i)~~

~~The tax effect was calculated using an effective tax rate for each item.~~

~~(ii)~~

~~Per share values and totals may differ due to rounding.~~

Our adjusted diluted earnings per share increased for ~~both~~ the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 as compared to the prior year primarily due to ~~higher revenue.~~lower salary and benefits costs in the current quarter and a lower weighted-average outstanding share count due to our share repurchase activity in the current year.

Adjusted Income Before Taxes and Adjusted Income Taxes/Tax Rate

Adjusted income before taxes is defined as income from operations before income taxes adjusted for impairment, amortization, restructuring costs, transaction and ~~integration,~~transformation, net, gains and losses on disposals of operations and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results. Adjusted income before taxes is used solely for the purpose of calculating the adjusted income tax rate.

Adjusted income taxes/tax rate is defined as the provision for income taxes adjusted for taxes on certain items of impairment, amortization, restructuring costs, transaction and ~~integration,~~transformation, net, gains and losses on disposals of operations, the tax effects of internal reorganizations and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results, divided by adjusted income before taxes. Adjusted income taxes is used solely for the purpose of calculating the adjusted income tax rate.

Management believes that the adjusted income tax rate presents a rate that is more closely aligned to the rate that we would incur if not for the reduction of pre-tax income for the adjusted items and the tax effects of internal reorganizations, which are not core to our current and future operations.

Reconciliations of income from ~~continuing~~ operations before income taxes to adjusted income before taxes and provision for income taxes to adjusted income taxes for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ are as follows:


	Three Months Ended March 31,
	2022			2021
	($ in millions)
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES	$	157		$	590
Adjusted for certain items:
Impairment		81			—
Amortization		85			103
Restructuring costs		6			—
Transaction and transformation, net		20			24
Loss/(gain) on disposal of operations		54			(359	)
Adjusted income before taxes	$	403		$	358

Provision for income taxes	$	43		$	44
Tax effect on certain items listed above (i)		42			27
Adjusted income taxes	$	85		$	71

U.S. GAAP tax rate		27.5	%		7.4	%
Adjusted income tax rate		21.1	%		19.7	%

Three Months Ended
September 30,

Nine Months Ended
September 30,

2021

2020

2021

2020

($ in millions)

INCOME FROM CONTINUING OPERATIONS BEFORE
INCOME TAXES

$
1,186

$
161

$
1,968

$
417

Adjusted for certain items:

Abandonment of long-lived asset

—

—

—

35

Amortization

85

108

285

347

Transaction and integration, net

(952
)

42

(877
)

65

Provision for significant litigation

—

15

—

15

Gain on disposal of operations

(23
)

(85
)

(380
)

(83
)
Adjusted income before taxes

$
296

$
241

$
996

$
796

Provision for income taxes

$
267

$
42

$
386

$
133

Tax effect on certain items listed above ⁽ⁱ⁾

(199
)

31

(144
)

96

Tax effect of statutory rate change

—

—

(40
)

—

Tax effect of the CARES Act

—

(3
)

—

(38
)
Adjusted income taxes

$
68

$
70

$
202

$
191

U.S. GAAP tax rate

22.5
%

26.6
%

19.6
%

31.9
%
Adjusted income tax rate

23.2
%

29.3
%

20.3
%

24.0
%
(i)

The tax effect was calculated using an effective tax rate for each item.

~~(i)~~

~~The tax effect was calculated using an effective tax rate for each item.~~

Our U.S. GAAP tax rates were ~~22.5%~~27.5% and ~~26.6%~~7.4% for the three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020, respectively, and 19.6% and 31.9% for~~respectively. The prior quarter effective tax rate was lower due to the ~~nine months ended September 30, 2021 and 2020, respectively. The~~tax-exempt disposal of our Miller business. Additionally, the current quarter effective tax rate includes ~~a $250 million estimated~~the tax ~~expense related to the income receipt~~effect of the termination payment, however the prior year effective tax rate for the three months ended September 30, 2020 was higher due to an additional deferred tax expense related to the enacted U.K. statutory tax rate change.divestment of our Russia business.

Our adjusted income tax rates were ~~23.2%~~21.1% and ~~29.3%~~19.7% for the three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020, respectively, and 20.3% and 24.0% for the nine months ended September 30, 2021 and 2020,~~ respectively. ~~Our~~The current quarter adjusted tax rate ~~for the three and nine months ended September 30, 2021 are lower than the three and nine months ended September 30, 2020 primarily~~is higher due to ~~a partial valuation allowance release on a U.K. capital loss carryforward.~~the distribution of geographical income.

Free Cash Flow

Free cash flow is defined as cash flows from operating activities less cash used to purchase fixed assets and software for internal use. Free cash flow is a liquidity measure and is not meant to represent residual cash flow available for discretionary expenditures.

Management believes that free cash flow presents the core operating performance and cash generating capabilities of our business operations.

Reconciliations of cash flows (used in)/from operating activities to free cash flow for the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ are as follows:

	Nine Months Ended September 30,
	2021			2020			Three Months Ended March 31,
	(in millions)						2022			2021
Cash flows from operating activities	$	1,877		$	1,206
							(in millions)
Cash flows from/(used in) operating activities							$	21		$	(128	)
Less: Additions to fixed assets and software for internal use		(109	)		(183	)		(31	)		(37	)
Free cash flow	$	1,768		$	1,023		$	(10	)	$	(165	)

The favorable movement in free cash flows in the first ~~nine months~~quarter of ~~2021~~2022 was ~~primarily~~ due to the ~~$1 billion~~absence of ~~income receipt related to~~ the ~~termination of the proposed Aon transaction and lower capital expenditures, partially offset by~~ net legal settlement payments of $185 million ~~as well as $189 million of increased~~made last year, partially offset by higher bonus payments and ~~benefit-related payments made during~~lower reinsurance-related cash collections in the ~~period.~~current quarter.

Additionally, the free cash flow for ~~both~~ the ~~current and~~ prior ~~years include~~year period presented includes the operating cash flows of Willis Re.Re. Willis Re’s operating cash flows approximate its pre-tax income and any adjustments for working capital movements (see Note 3 — Acquisitions and Divestitures inwithin Part I, Item 1 ~~‘Financial~~‘Financial Statements’ in this ~~Quarterly Report on~~ Form 10-Q for ~~further information)~~additional information), ~~and~~the absence of which is expected to be partially ~~offset~~made up by reimbursements through ~~a Transition Services Agreement.~~the TSA.

Critical Accounting ~~Policies and~~ Estimates

There were no material changes from the Critical Accounting ~~Policies and~~ Estimates disclosed in our ~~2020~~ Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February ~~23, 2021.~~24, 2022.

ITEM 3. QUANTITATIVE AND ~~QUALITATIVE~~QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We have considered changes in our exposure to market risks during the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 and have determined that there have been no material changes to our exposure to market risks from those described in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2020,~~2021, filed with the SEC on February ~~23, 2021.~~24, 2022. However, we have provided the following information to supplement or update our disclosures on our Form 10-K.

~~LIBOR-Related Debt Instruments~~

In July 2017, the Financial Conduct Authority, the authority that regulates LIBOR, announced its intention to phase out LIBOR as a benchmark rate by the end of 2021. The Alternative Reference Rates Committee (‘ARRC’), a group of private-market participants convened by the Federal Reserve Board and the Federal Reserve Bank of New York to help ensure a successful transition from U.S. dollar LIBOR (‘USD-LIBOR’) to a more robust reference rate, has proposed that the Secured Overnight Financing Rate (‘SOFR’) represents the best alternative to USD-LIBOR for use in derivatives and other financial contracts that are currently indexed to USD-LIBOR. ARRC has proposed a transition plan with specific steps and timelines designed to encourage the adoption of SOFR and guide the transition to SOFR from USD-LIBOR. Organizations are currently working on industry-wide and company-specific transition plans related to derivatives and cash markets exposed to USD-LIBOR. Similar efforts are underway to identify suitable replacement reference rates for LIBOR in other major currencies.

Subsequently, on March 5, 2021, ICE Benchmark Administration (‘IBA’) stated that as a result of its not having access to input data necessary to calculate LIBOR settings on a representative basis beyond the intended cessation dates as set forth below, it would have to cease publication of all 35 LIBOR settings immediately after December 31, 2021 for all GBP-, EUR-, CHF- and JPY-LIBOR settings as well as 1-week and 2-month USD-LIBOR settings. Effective after June 30, 2023, IBA will cease publishing overnight and 1-, 3-, 6- and 12-month USD-LIBOR settings.

As of September 30, 2021, the Company’s primary exposure was its $1.25 billion revolving credit facility which has subsequently been replaced with a new $1.5 billion revolving credit facility which contains appropriate LIBOR replacement language. The Company has a small, collateralized facility that we will renegotiate, or repay, prior to the end of 2021. In addition, the Company and its subsidiaries have entered into various intercompany notes indexed to LIBOR in various currencies. The Company, in preparation for a December 31, 2021 deadline, will amend, replace, or terminate the LIBOR-based intercompany notes as necessary to reflect new market benchmarks for the relevant loan currencies.

We have updated our Treasury workstation software to implement the new benchmarks and continue to monitor the LIBOR-related risks that may be inherent elsewhere in our business and are monitoring further proposals and guidance from the ARRC and other alternative-rate initiatives. While it is currently uncertain whether SOFR or another reference rate will be selected as the alternative to LIBOR, or whether other reforms will be enacted in response to the planned transition, we will make the appropriate changes when necessary.

Interest Income on Fiduciary Funds

As described in our Form 10-K, we are exposed to interest rate risk. Specifically, as a result of our operating activities, we receive cash for premiums and claims which we deposit in short-term investments denominated in U.S. dollars and other currencies. We earn interest on these funds, which is included in our condensed consolidated financial statements as interest income. These funds are regulated in terms of access and the instruments in which they may be invested, most of which are short-term in maturity. At ~~September 30, 2021,~~March 31, 2022, we held ~~$2.2~~$1.6 billion of fiduciary funds invested in interest-bearing accounts. If short-term interest rates increased or decreased by 25 basis points, interest earned on these invested fiduciary funds, and therefore our interest income recognized, would increase or decrease by approximately $6$4 million on an annualized basis.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of ~~September 30, 2021,~~March 31, 2022, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Chief Executive Officer (‘CEO’) and the Chief Financial Officer (‘CFO’), of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as defined by Exchange Act Rule 13a-15(e). Based upon

that evaluation, the CEO and the CFO concluded that the Company’s disclosure controls and procedures are effective in ensuring that the information required to be included in the Company’s periodic SEC filings is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms and that such information is accumulated and communicated to management, including the CEO and the CFO, as appropriate, to allow for timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There have been no changes in the Company’s internal ~~controls~~control over financial reporting during the quarter ended ~~September 30, 2021~~March 31, 2022 that ~~have~~ materially affected, or are reasonably likely to materially affect, ~~the Company’s~~our internal control over financial reporting. Most of our employees who are involved in our financial reporting processes and controls continue to work remotely following the onset of the COVID-19 pandemic and are expected to do so for the foreseeable future. ~~We have~~COVID-19 has not ~~experienced~~had any specific impact to the design or operating effectiveness of our internal controls over financial reporting. ~~We are regularly monitoring and assessing the impact of the COVID-19 situation on our internal controls to minimize the impact on their design and operating effectiveness.~~

Limitations on the Effectiveness of Controls

Management, including the CEO and CFO, does not expect that our disclosure controls and procedures will necessarily prevent all errors and all fraud. However, management does expect that the control system provides reasonable assurance that its objectives will be met. A control system, no matter how well designed and operated, cannot provide absolute assurance that the control system’s objectives will be met. In addition, the design of such internal controls must take into account the costs of designing and maintaining such a control system. Certain inherent limitations exist in control systems to make absolute assurances difficult, including the realities that judgments in decision-making can be faulty, that breakdowns can occur because of a simple error or mistake, and that individuals can circumvent controls. The design of any control system is based in part upon existing business conditions and risk assessments. There can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in business conditions or deterioration in the degree of compliance with policies or procedures. As a result, they may require change or revision. Because of the inherent limitations in a control system, misstatements due to error or fraud may occur and may not be detected. Nevertheless, the disclosure controls and procedures are designed to provide reasonable assurance of achieving their stated objectives, and the CEO and CFO have concluded that the disclosure controls and procedures are effective at a reasonable assurance level.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, we are a party to various lawsuits, arbitrations or mediations that arise in the ordinary course of business. The disclosure called for by Part II, Item 1 regarding our legal proceedings is incorporated by reference herein from Part I, Item 1 Note 1314 — Commitments and Contingencies - Legal Proceedings of the notes to the condensed consolidated financial statements in this Form 10-Q for the quarter ended ~~September 30, 2021.~~March 31, 2022.

ITEM 1A. RISK FACTORS

Except as described below, there are no material changes from ~~the~~ risk factors as previously disclosed in our Annual Report on Form 10-K, filed with the SEC on February ~~23, 2021.~~24, 2022. We urge you to read the risk factors contained therein.

Our ~~pending transaction with Gallagher creates incremental~~ business, ~~regulatory~~financial condition and ~~reputational risks.~~

The agreed transaction to sell our Willis Re business to Gallagher entails important risks, including, among others: the risk, as described more below, that we are unable to obtain the requisite regulatory approvals or satisfy allresults of ~~the other conditions required to consummate the proposed transaction~~operations may be materially adversely affected by any negative impact on the ~~proposed terms~~global economy and ~~schedule, if at all;~~capital markets resulting from the ~~risk that~~conflict in Ukraine or any other geopolitical tensions.

U.S. and global markets are experiencing volatility and disruption following the ~~period leading up to a transaction closing~~escalation of geopolitical tensions and the ~~post-closing transition arrangements may impose costs, be distracting to our management, or cause disruption to our business or our relationships with clients, employees~~crisis in Ukraine. Although the length and other third parties; the risk that the triggers for the potential earnout payment may not be met; the risk that transaction and/or transition costs or dis-synergies are greater than expected, including as a result of conditions regulators put on any approvals of the transaction; the impact of the ~~announcement and/or~~ongoing situation is highly unpredictable, the ~~potential impact~~crisis in Ukraine could lead to further market disruptions.

Additionally, as we announced on March 13, 2022, we intend to transfer ownership of the consummation of the proposed transaction on relationships, including with employees, suppliers, clients and competitors; the risk that management’s attention is diverted from other matters during the pendency of the transaction andour Russian subsidiary to local management who will operate independently in the ~~post-closing period; the risk that litigation associated with the proposed transaction, if any, affects the combination or the~~Russian market. In 2021, this business ~~otherwise; the risk~~constituted approximately 1% of ~~disruptions from the proposed transaction that impact~~ our ~~business, including current plans and operations, including the risk of exacerbating existing disruptions or challenges we face; and other risks described below and~~consolidated revenue. The transfer is in the ~~Company’s other SEC filings.~~

~~The transaction with Gallagher is~~process of being documented and implemented, subject to ~~customary closing conditions, including conditions related to~~any required regulatory approvals and conditions. We are continuing to monitor the situation in Ukraine and globally and assessing its potential impact on our business.

Sanctions imposed by the U.S., the E.U., the U.K. and other countries, as well as Russian counter-sanctions, are extensive. Additional sanctions and penalties have also been enacted, proposed and/or threatened. Russian actions and the resulting sanctions could adversely affect the global economy and financial markets and lead to instability and lack of liquidity in capital markets. The ramifications of the hostilities and sanctions, however, may not be ~~completed on a timely basis, or at all, or such required regulatory approvals~~limited to Russia and Russian companies but may ~~contain material restrictions or conditions,~~spill over to and negatively impact other regional and global economic markets (including Europe and the ~~failure to complete~~United States), companies in other countries (particularly those that have done business with Russia) and various sectors, industries and markets for securities and commodities globally, such as oil and natural gas. Accordingly, the ~~transaction~~actions discussed above and the potential for a wider conflict could increase financial market volatility, cause severe negative effects on regional and global economic markets, industries, and companies. In addition, Russia may take retaliatory actions and other countermeasures, including cyberattacks and espionage against other countries and companies around the world, which may negatively impact such countries and companies. The extent and duration of the Russian actions or future escalation of such hostilities, the extent and impact of existing and future sanctions, market disruptions and volatility, and the result of any diplomatic negotiations cannot be predicted.

Any of the above-mentioned factors could adversely affect our business, prospects, financial condition ~~or results of operations.~~

and operating results. The ~~closing~~extent and duration of the ~~transaction with Gallagher is subject~~crisis, sanctions and resulting market disruptions are impossible to the satisfaction or waiver of a number of customary conditions, including (i) receipt of certain governmental approvals under competition, foreign investment and financial services laws, (ii) expiration or termination of the applicable waiting period under the U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976, (iii) the absence of governmental restraints or prohibitions preventing the transaction closing and (iv) certain other customary closing conditions, and there canpredict, but could be no assurance that all of these conditions will be satisfied or waived (to the extent applicable) in a timely manner or at all. The failure to satisfy these required conditions could delay the transaction closing for a significant period of time or prevent it from occurring at all. The agreement contemplates delayed closings in certain countries pending completion of certain country-specific closing conditions.substantial.

The agreement contains representations and warranties as well as pre-closing covenants made by each of WTW and Gallagher, customary for a transaction of this type. The agreement contains certain termination rights for each of WTW and Gallagher, including in the event that the transaction is not consummated on or before May 12, 2022, subject to two automatic extensions of three months and one month, respectively, if all conditions have been satisfied other than those related to the receipt of regulatory approvals and those to be satisfied at closing. There can be no assurance that the transaction closing conditions will be timely satisfied or otherwise waived, that the transaction will be completed within the expected timeframe, or at all, or that the expected benefits of the transaction will be achieved in the expected timeframe, or at all.

~~If the proposed transaction with Gallagher is not completed for any reason it may materially affect our business, financial condition or results of operations.~~

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, no shares were issued by the Company without registration under the Securities Act of 1933, as amended.

The following table presents specified information about the Company’s repurchases of its ordinary shares in the ~~third~~first quarter of ~~2021~~
2022 and the Company’s remaining repurchase authority.

Period

Total number of shares purchased

Average price
paid per share

Total number of shares purchased as part of publicly announced plans or programs

Maximum number of shares that may yet be purchased under the plans or programs

July 1, 2021 through July 31, 2021

—

$
—

—

23,813,713

August 1, 2021 through August 31, 2021

1,742,094

$
216.69

1,742,094

22,071,619

September 1, 2021 through September 30, 2021

2,713,450

$
229.41

2,713,450

19,358,169

4,455,544

$
—

4,455,544


Period	Total number of shares purchased		Average price paid per share		Total number of shares purchased as part of publicly announced plans or programs		Maximum number of shares that may yet be purchased under the plans or programs
January 1, 2022 through January 31, 2022		3,244,661	$	230.87		3,244,661		13,484,986
February 1, 2022 through February 28, 2022		3,305,686	$	227.16		3,305,686		10,179,300
March 1, 2022 through March 31, 2022		3,310,067	$	226.58		3,310,067		6,869,233
		9,860,414	$	228.19		9,860,414

~~The~~At March 31, 2022 the maximum number of shares that may yet be purchased under the existing ~~share~~stock repurchase plan is ~~19,358,169. At September 30, 2021,~~6,869,233, with approximately ~~$4.5~~$1.6 billion ~~remained~~remaining on the current open-ended repurchase authority granted by the board. An estimate of the maximum number of shares under the existing authorities was determined using the closing price of our ordinary shares on ~~September 30, 2021~~March 31, 2022 of ~~$232.46.~~$236.22.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

EXHIBIT INDEX


Exhibit Number		Description of Exhibit
10.1		~~Security and Asset Purchase~~Form of Executive Officer Time-Based Restricted Share Unit Award Agreement ~~dated as of August 12, 2021, by and between Willis Towers Watson plc and Arthur J. Gallagher & Co.~~under the 2022 Long-Term Incentive Compensation Program (incorporated by reference to Exhibit 10.1 to the ~~Current Report on~~ Form 8-K filed by the Company on ~~August 16, 2021)~~February 28, 2022).†
10.2		~~Second Amended and Restated Credit~~Form of Executive Officer Performance-Based Restricted Share Unit Award Agreement ~~dated as of October 6, 2021, among, Trinity Acquisition plc and its indirect subsidiaries, Willis North America Inc. and Willis Netherlands Holdings B.V., Willis Towers Watson Public Limited Company,~~under the ~~lenders party thereto and Barclays Bank PLC, as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the Company on October 7, 2021).~~
~~10.3~~		Second Amended and Restated Guaranty Agreement, dated as of October 6, 2021, among, Trinity Acquisition plc, Willis Towers Watson Public Limited Company, the other guarantors party thereto and Barclays Bank PLC, as Administrative Agent2022 Long-Term Incentive Compensation Program (incorporated by reference to Exhibit 10.2 to the ~~Current Report on~~ Form 8-K filed by the Company on ~~October 7, 2021)~~February 28, 2022).
~~10.4~~		Offer Letter, dated as of August 26, 2021, by and between Willis Towers Watson US LLC and Andrew Krasner.*†
~~10.5~~10.3		~~Time-Based Restricted Share Unit Award Agreement,~~Willis Towers Watson Severance and Change in Control Pay Plan for U.S. Executives, dated as of ~~September 7, 2021, by and between the Company and Andrew Krasner. *†~~
~~10.6~~		~~Termination Agreement, dated as of July 26, 2021, by and between Willis Towers Watson plc and Aon plc~~February 22, 2022 (incorporated by reference to Exhibit ~~10.1~~10.3 to the ~~Current Report on~~ Form 8-K filed by the Company on ~~July 26, 2021)~~February 28, 2022).†
~~22.1~~10.4		Willis Towers Watson Severance and Change in Control Pay Plan for Non-U.S. Executives, dated as of February 22, 2022 (incorporated by reference to Exhibit 10.4 to the Form 8-K filed by the Company on February 28, 2022). †
22.1		List of Issuers and Guarantor Subsidiaries.*Subsidiaries (incorporated by reference to Exhibit 22.1 to the Form 10-Q filed by the Company on October 28, 2021).
31.1		Certification of the Registrant’s Chief Executive Officer, ~~John J. Haley,~~Carl A. Hess, pursuant to Rule 13a-14 of the Securities Exchange Act of 1934.*
31.2		Certification of the Registrant’s Chief Financial Officer, Andrew J. Krasner, pursuant to Rule 13a-14 of the Securities Exchange Act of 1934.*
32.1		Certification of the Registrant’s Chief Executive Officer, ~~John J. Haley,~~Carl A. Hess, and Chief Financial Officer, Andrew J. Krasner, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document*
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document*
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document*
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document*
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document*
104		Cover Page Interactive Data File (formatted as ~~Inline~~inline XBRL and contained in Exhibit 101)*

* Filed or furnished herewith.

† Management contract or compensatory plan or arrangement.

SIGNATURES

~~Filed or furnished herewith.~~

†	~~Management contract or compensatory plan or arrangement.~~

~~SIGNATURES~~

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


Willis Towers Watson Public Limited Company
(Registrant)

/s/ ~~John J. Haley~~		Carl A. Hess	~~October~~	April 28, ~~2021~~2022
Name:	~~John J. Haley~~Carl A. Hess		Date
Title:	Chief Executive Officer

/s/ Andrew J. Krasner			~~October~~	April 28, ~~2021~~2022
Name:	Andrew J. Krasner		Date
Title:	Chief Financial Officer

/s/ Joseph S. Kurpis			~~October~~	April 28, ~~2021~~2022
Name:	Joseph S. Kurpis		Date
Title:	Principal Accounting Officer and Controller

5651


Ireland (Jurisdiction of incorporation or organization)		98-0352587 (I.R.S. Employer Identification No.)


c/o Willis Group Limited 51 Lime Street, LondonEC3M 7DQ, England (Address of principal executive offices)		~~(011)~~ (011) 44-20-3124-6000 (Registrant’s telephone number, including area code)


Large accelerated filer	☑	Accelerated filer		Non-accelerated filer		Smaller reporting company	☐

Emerging growth company	☐	☐	~~Non-accelerated filer~~	☐	~~Smaller reporting company~~	☐

~~Emerging growth company~~	☐


	Page
Certain Definitions		3
Disclaimer Regarding Forward-looking Statements		4

PART I. FINANCIAL INFORMATION		7
Item 1. Financial Statements (Unaudited)		7
Condensed Consolidated Statements of Comprehensive Income - Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~		7
Condensed Consolidated Balance Sheets ~~– September 30, 2021~~- March 31, 2022 and December 31, ~~2020~~2021		8
Condensed Consolidated Statements of Cash Flows - ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~		9
Condensed Consolidated Statements of Changes in Equity - ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~		10
Notes to the Condensed Consolidated Financial Statements		1211
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		3027
Item 3. Quantitative and Qualitative Disclosures About Market Risk		5147
Item 4. Controls and Procedures		5147

PART II. OTHER INFORMATION		5348
Item 1. Legal Proceedings		5348
Item 1A. Risk Factors		5348
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		5348
Item 3. Defaults Upon Senior Securities		5449
Item 4. Mine Safety Disclosures		5449
Item 5. Other Information		5449
Item 6. Exhibits		5550
Signatures		5651


‘We’, ‘Us’, ‘Company’, ‘Willis Towers Watson’, ‘Our’, ‘Willis Towers Watson plc’ or ‘WTW’		Willis Towers Watson Public Limited Company, a company organized under the laws of Ireland, and its subsidiaries

‘shares’		The ordinary shares of Willis Towers Watson Public Limited Company, nominal value $0.000304635 per share

‘Willis’		Willis Group Holdings Public Limited Company and its subsidiaries, predecessor to ~~Willis Towers Watson,~~WTW, prior to the Merger

‘Towers Watson’		Towers Watson & Co. and its subsidiaries

‘Merger’		Merger of Willis Group Holdings Public Limited Company and Towers Watson & Co. pursuant to the Agreement and Plan of Merger, dated June 29, 2015, as amended on November 19, 2015, and completed on January 4, 2016

‘Miller’		Miller Insurance Services LLP and its subsidiaries

‘TRANZACT’		CD&R TZ Holdings, Inc. and its subsidiaries, doing business as TRANZACT

‘U.S.’		United States

‘U.K.’		United Kingdom

‘Brexit’		The United Kingdom’s exit from the European Union, which occurred on January 31, 2020.

‘E.U.’		European Union or European Union 27 (the number of member countries following the United Kingdom’s exit)

‘U.S. GAAP’		United States Generally Accepted Accounting Principles

‘FASB’		Financial Accounting Standards Board

‘~~ASU’~~ASC’		Accounting Standards ~~Update~~Codification

‘~~ASC’~~ASU’		Accounting Standards ~~Codification~~Update

‘SEC’		United States Securities and Exchange Commission


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	March 31, 2022			December 31, 2021
ASSETS
Cash and cash equivalents	$	2,198		$	4,486
Fiduciary assets		11,631			11,014
Accounts receivable, net		2,186			2,370
Prepaid and other current assets		390			612
Current assets held for sale		7			6
Total current assets		16,412			18,488
Fixed assets, net		817			851
Goodwill		10,200			10,183
Other intangible assets, net		2,492			2,555
Right-of-use assets		701			720
Pension benefits assets		992			971
Other non-current assets		1,227			1,202
Total non-current assets		16,429			16,482
TOTAL ASSETS	$	32,841		$	34,970
LIABILITIES AND EQUITY
Fiduciary liabilities	$	11,631		$	11,014
Deferred revenue and accrued expenses		1,398			1,926
Current debt		599			613
Current lease liabilities		142			150
Other current liabilities		1,137			1,015
Current liabilities held for sale		7			6
Total current liabilities		14,914			14,724
Long-term debt		3,975			3,974
Liability for pension benefits		698			757
Deferred tax liabilities		835			845
Provision for liabilities		385			375
Long-term lease liabilities		715			734
Other non-current liabilities		244			253
Total non-current liabilities		6,852			6,938
TOTAL LIABILITIES		21,766			21,662
COMMITMENTS AND CONTINGENCIES
EQUITY (i)
Additional paid-in capital		10,826			10,804
Retained earnings		2,423			4,645
Accumulated other comprehensive loss, net of tax		(2,242	)		(2,186	)
Treasury shares, at cost, 17,519 shares in 2022 and 2021		(3	)		(3	)
Total WTW shareholders’ equity		11,004			13,260
Non-controlling interests		71			48
Total equity		11,075			13,308
TOTAL LIABILITIES AND EQUITY	$	32,841		$	34,970

	Nine Months Ended September 30, 2021
	Shares outstanding			Additional paid-in capital			Retained earnings			Treasury shares			AOCL ⁽ⁱ⁾			Total WTW shareholders’ equity			Non-controlling interests			Total equity
Balance as of December 31, 2020		128,965		$	10,748		$	2,434		$	(3	)	$	(2,359	)	$	10,820		$	112		$	10,932
Net income		—			—			733			—			—			733			3			736
Dividends declared ($0.71 per share)		—			—			(92	)		—			—			(92	)		—			(92	)
Dividends attributable to non-controlling interests		—			—			—			—			—			—			(17	)		(17	)
Other comprehensive income		—			—			—			—			48			48			2			50
Issuance of shares under employee stock compensation plans		9			1			—			—			—			1			—			1
Share-based compensation and net settlements		—			12			—			—			—			12			—			12
Reduction of non-controlling interests ⁽ⁱⁱ⁾		—			—			—			—			—			—			(52	)		(52	)
Foreign currency translation		—			4			—			—			—			4			—			4
Balance as of March 31, 2021		128,974		$	10,765		$	3,075		$	(3	)	$	(2,311	)	$	11,526		$	48		$	11,574
Net income		—			—			184			—			—			184			2			186
Dividends declared ($0.71 per share)		—			—			(93	)		—			—			(93	)		—			(93	)
Dividends attributable to non-controlling interests		—			—			—			—			—			—			(4	)		(4	)
Other comprehensive income		—			—			—			—			33			33			—			33
Issuance of shares under employee stock compensation plans		14			1			—			—			—			1			—			1
Share-based compensation and net settlements		—			20			—			—			—			20			—			20
Reduction of non-controlling interests ⁽ⁱⁱ⁾		—			—			—			—			—			—			(1	)		(1	)
Foreign currency translation		—			(1	)		—			—			—			(1	)		—			(1	)
Balance as of June 30, 2021		128,988		$	10,785		$	3,166		$	(3	)	$	(2,278	)	$	11,670		$	45		$	11,715
Shares repurchased		(4,456	)		—			(1,000	)		—			—			(1,000	)		—			(1,000	)
Net income		—			—			903			—			—			903			4			907
Dividends declared ($0.80 per share)		—			—			(100	)		—			—			(100	)		—			(100	)
Dividends attributable to non-controlling interests		—			—			—			—			—			—			(6	)		(6	)
Other comprehensive loss		—			—			—			—			(81	)		(81	)		—			(81	)
Issuance of shares under employee stock compensation plans		64			—			—			—			—			—			—			—
Share-based compensation and net settlements		—			6			—			—			—			6			—			6
Reduction of non-controlling interests ⁽ⁱⁱ⁾		—			(8	)		—			—			—			(8	)		(3	)		(11	)
Foreign currency translation		—			3			—			—			—			3			—			3
Balance as of September 30, 2021		124,596		$	10,786		$	2,969		$	(3	)	$	(2,359	)	$	11,393		$	40		$	11,433

	Nine Months Ended September 30, 2020
	Shares outstanding		Additional paid-in capital			Retained earnings			Treasury shares			AOCL ⁽ⁱ⁾			Total WTW shareholders’ equity			Non-controlling interests			Total equity
Balance as of December 31, 2019		128,690	$	10,687		$	1,792		$	(3	)	$	(2,227	)	$	10,249		$	120		$	10,369
Net income		—		—			305			—			—			305			8			313
Dividends declared ($0.68 per share)		—		—			(88	)		—			—			(88	)		—			(88	)
Dividends attributable to non-controlling interests		—		—			—			—			—			—			(1	)		(1	)
Other comprehensive loss		—		—			—			—			(219	)		(219	)		(1	)		(220	)
Issuance of shares under employee stock compensation plans		36		3			—			—			—			3			—			3
Share-based compensation and net settlements		—		9			—			—			—			9			—			9
Foreign currency translation		—		4			—			—			—			4			—			4
Balance as of March 31, 2020		128,726	$	10,703		$	2,009		$	(3	)	$	(2,446	)	$	10,263		$	126		$	10,389
Net income		—		—			94			—			—			94			8			102
Dividends declared ($0.68 per share)		—		—			(88	)		—			—			(88	)		—			(88	)
Dividends attributable to non-controlling interests		—		—			—			—			—			—			(12	)		(12	)
Other comprehensive income		—		—			—			—			56			56			—			56
Issuance of shares under employee stock compensation plans		37		2			—			—			—			2			—			2
Share-based compensation and net settlements		—		12			—			—			—			12			—			12
Reduction of non-controlling interests ⁽ⁱⁱ⁾		—		—			—			—			—			—			(1	)		(1	)
Other		—		(3	)		—			—			—			(3	)		—			(3	)
Foreign currency translation		—		(1	)		—			—			—			(1	)		—			(1	)
Balance as of June 30, 2020		128,763	$	10,713		$	2,015		$	(3	)	$	(2,390	)	$	10,335		$	121		$	10,456
Net income		—		—			121			—			—			121			1			122
Dividends declared ($0.68 per share)		—		—			(89	)		—			—			(89	)		—			(89	)
Dividends attributable to non-controlling interests		—		—			—			—			—			—			(9	)		(9	)
Other comprehensive income		—		—			—			—			137			137			1			138
Issuance of shares under employee stock compensation plans		108		3			—			—			—			3			—			3
Share-based compensation and net settlements		—		6			—			—			—			6			—			6
Reduction of non-controlling interests ⁽ⁱⁱ⁾		—		7			—			—			—			7			(9	)		(2	)
Foreign currency translation		—		(5	)		—			—			—			(5	)		—			(5	)
Balance as of September 30, 2020		128,871	$	10,724		$	2,047		$	(3	)	$	(2,253	)	$	10,515		$	105		$	10,620

	September 30, 2021		December 31, 2020
Assets held for sale:
Cash and cash equivalents	$	53	$	50
Fiduciary assets		3,853		3,157
Accounts receivable, net		199		147
Fixed assets, net		1		1
Goodwill		812		812
Other intangible assets, net		8		8
Right-of-use assets		1		1
Other assets		34		40
Total assets held for sale	$	4,961	$	4,216
Liabilities held for sale:
Fiduciary liabilities	$	3,853	$	3,157
Deferred revenue and accrued expenses		101		118
Liability for pension benefits		1		2
Lease liabilities		1		1
Provision for liabilities		1		1
Other liabilities		163		126
Total liabilities held for sale	$	4,120	$	3,405

	Three Months Ended September 30,
	HCB				CRB				IRR				BDA				Corporate ⁽ⁱ⁾						Total
	2021		2020		2021		2020		2021		2020		2021		2020		2021			2020			2021		2020
Broking	$	68	$	62	$	621	$	592	$	11	$	71	$	119	$	100	$	—		$	—		$	819	$	825
Consulting		561		529		39		31		111		97		—		—		2			1			713		658
Outsourced administration		122		126		17		16		4		4		123		126		—			—			266		272
Other		97		77		4		4		46		48		—		—		1			1			148		130
Total revenue by service offering		848		794		681		643		172		220		242		226		3			2			1,946		1,885
Reimbursable expenses and other ⁽ⁱ⁾		10		10		—		—		2		1		2		2		(9	)		(10	)		5		3
Total revenue from customer contracts	$	858	$	804	$	681	$	643	$	174	$	221	$	244	$	228	$	(6	)	$	(8	)	$	1,951	$	1,888
Interest and other income ⁽ⁱⁱ⁾		4		2		16		6		—		—		—		—		2			1			22		9
Total revenue	$	862	$	806	$	697	$	649	$	174	$	221	$	244	$	228	$	(4	)	$	(7	)	$	1,973	$	1,897

		Remainder of 2021				2022				2023 onward				Total
Revenue expected to be recognized on contracts as of September 30, 2021		$	174			$	546			$	788			$	1,508

		(Loss)/gain recognized in income
		Three Months Ended September 30,					Nine Months Ended September 30,
Derivatives not designated as hedging instruments:	Location of (loss)/gain recognized in income	2021			2020		2021			2020
Forward exchange contracts	Other income, net	$	(7	)	$	5	$	(36	)	$	(15	)

	September 30, 2021		December 31, 2020
Revolving $1.25 billion credit facility ⁽ⁱ⁾	$	—	$	—
5.750% senior notes due 2021		—		500
3.500% senior notes due 2021		—		449
2.125% senior notes due 2022⁽ⁱⁱ⁾		625		—
Current portion of collateralized facility		19		22
	$	644	$	971

	September 30, 2021		December 31, 2020
Revolving $1.25 billion credit facility	$	—	$	—
Collateralized facility ⁽ⁱⁱⁱ⁾		19		33
2.125% senior notes due 2022⁽ⁱⁱ⁾		—		659
4.625% senior notes due 2023		249		249
3.600% senior notes due 2024		648		647
4.400% senior notes due 2026		546		546
4.500% senior notes due 2028		596		596
2.950% senior notes due 2029		727		726
6.125% senior notes due 2043		271		271
5.050% senior notes due 2048		395		395
3.875% senior notes due 2049		542		542
	$	3,993	$	4,664

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)	September 30, 2021
Balance at December 31, 2020	$	45
Obligations assumed		0
Payments		(19	)
Realized and unrealized gains		5
Foreign exchange		(1	)
Balance at September 30, 2021	$	30


	March 31, 2022		December 31, 2021
Prepayments and accrued income	$	114	$	137
Short-term investments		0		200
Deferred contract costs		64		74
Derivatives and investments		28		35
Deferred compensation plan assets		12		19
Corporate income and other taxes		116		82
Acquired renewal commissions receivable		9		11
Other current assets		47		54
Total prepaid and other current assets	$	390	$	612


	March 31, 2022		December 31, 2021
Accounts payable, accrued liabilities and deferred income	$	926	$	898
Accrued discretionary and incentive compensation		262		811
Accrued vacation		167		145
Other employee-related liabilities		43		72
Total deferred revenue and accrued expenses	$	1,398	$	1,926


	March 31, 2022		December 31, 2021
Dividends payable	$	108	$	112
Income and other taxes payable		313		278
Interest payable		28		55
Deferred compensation plan liabilities		43		49
Contingent and deferred consideration on acquisitions		15		24
Accrued retirement benefits		58		65
Payroll and other benefits-related liabilities		351		230
Third-party commissions		110		101
Other current liabilities		111		101
Total other non-current liabilities	$	1,137	$	1,015


	March 31, 2022		December 31, 2021
Claims, lawsuits and other proceedings	$	316	$	311
Other provisions		69		64
Total provision for liabilities	$	385	$	375

	September 30, 2021		December 31, 2020
Deferred compensation plan liability	$	100	$	103
Contingent and deferred consideration on acquisitions		13		16
Liabilities for uncertain tax positions		45		49
Derivatives		—		2
Finance leases		17		19
Other non-current liabilities		64		92
Total other non-current liabilities	$	239	$	281

	Foreign currency translation ⁽ⁱ⁾						Derivative instruments⁽ⁱ⁾						Defined pension and post-retirement benefit costs ⁽ⁱⁱ⁾						Total
	2021			2020			2021			2020			2021			2020			2021			2020
Quarter-to-date activity:
Balance at June 30, 2021 and 2020, respectively	$	(376	)	$	(698	)	$	13		$	(6	)	$	(1,915	)	$	(1,686	)	$	(2,278	)	$	(2,390	)
Other comprehensive (loss)/income before reclassifications		(81	)		119			(1	)		5			2			0			(80	)		124
(Gain)/loss reclassified from accumulated other comprehensive loss (net of income tax benefit of $8 and $2, respectively)		0			0			(1	)		4			0			9			(1	)		13
Net current-period other comprehensive (loss)/income		(81	)		119			(2	)		9			2			9			(81	)		137
Balance at September 30, 2021 and 2020, respectively	$	(457	)	$	(579	)	$	11		$	3		$	(1,913	)	$	(1,677	)	$	(2,359	)	$	(2,253	)

Year-to-date activity:
Balance at December 31, 2020 and 2019, respectively	$	(400	)	$	(538	)	$	9		$	13		$	(1,968	)	$	(1,702	)	$	(2,359	)	$	(2,227	)
Other comprehensive (loss)/income before reclassifications		(101	)		(41	)		7			(17	)		2			2			(92	)		(56	)
Loss/(gain) reclassified from accumulated other comprehensive loss (net of income tax benefit of $15 and $9, respectively) ⁽ⁱⁱⁱ⁾		44			0			(5	)		7			53			23			92			30
Net current-period other comprehensive (loss)/income		(57	)		(41	)		2			(10	)		55			25			0			(26	)
Balance at September 30, 2021 and 2020, respectively	$	(457	)	$	(579	)	$	11		$	3		$	(1,913	)	$	(1,677	)	$	(2,359	)	$	(2,253	)

Transactional Currency	Revenue			Expenses ⁽ⁱ⁾
U.S. dollars		55	%		52	%
Pounds sterling		13	%		19	%
Euro		17	%		13	%
Other currencies		15	%		16	%

						Components of Revenue Change ⁽ⁱ⁾
					As		Constant
	Three Months Ended September 30,				Reported	Currency	Currency	Acquisitions/	Organic
	2021		2020		Change	Impact	Change	Divestitures	Change
	($ in millions)
Revenue	$	1,973	$	1,897	4%	1%	3%	(4)%	7%

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Shares repurchased		4,455,544		4,455,544
Average price per share	$224.44		$224.44
Aggregate repurchase cost (excluding broker costs)	$1.0 billion		$1.0 billion

`	As of September 30, 2021		As of December 31, 2020
	(in millions)
Total current assets	$	201	$	161
Total non-current assets		676		671
Total current liabilities		6,850		5,116
Total non-current liabilities		6,551		8,434

						Components of Revenue Change⁽ⁱ⁾
					As		Constant
	Nine Months Ended September 30,				Reported	Currency	Currency	Acquisitions/	Organic
	2021		2020		Change	Impact	Change	Divestitures	Change
	($ in millions)
Revenue ⁽ⁱⁱ⁾	$	6,292	$	5,946	6%	3%	3%	(4)%	6%