Part I Financial Information

Item 1. Financial Statements

Aon plc

Condensed Consolidated Statements of Income

(Unaudited)



	Three Months Ended
(millions, except per share data)	March 31, 2019			March 31, 2018
Revenue
Total revenue	$	3,143		$	3,090
Expenses
Compensation and benefits	1,584			1,616
Information technology	117			115
Premises	87			93
Depreciation of fixed assets	40			39
Amortization and impairment of intangible assets	97			110
Other general expenses	346			318
Total operating expenses	2,271			2,291
Operating income	872			799
Interest income	2			4
Interest expense	(72		)	(70		)
Other income (expense)	—			(15		)
Income from continuing operations before income taxes	802			718
Income taxes	126			114
Net income from continuing operations	676			604
Net income from discontinued operations	—			6
Net income	676			610
Less: Net income attributable to noncontrolling interests	17			16
Net income attributable to Aon shareholders	$	659		$	594

Basic net income per share attributable to Aon shareholders
Continuing operations	$	2.72		$	2.37
Discontinued operations	—			0.02
Net income	$	2.72		$	2.39
Diluted net income per share attributable to Aon shareholders
Continuing operations	$	2.70		$	2.35
Discontinued operations	—			0.02
Net income	$	2.70		$	2.37
Weighted average ordinary shares outstanding - basic	242.2			248.5
Weighted average ordinary shares outstanding - diluted	243.7			250.2

Three Months Ended Nine Months Ended
(millions, except per share data) September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016
Revenue

Total revenue $ 2,340
$ 2,201
$ 7,089
$ 6,759
Expenses

Compensation and benefits 1,419
1,300
4,337
4,041
Information technology 109
99
295
281
Premises 89
86
259
257
Depreciation of fixed assets 40
39
148
118
Amortization and impairment of intangible assets 101
42
604
117
Other general expenses 317
267
956
770
Total operating expenses 2,075
1,833
6,599
5,584
Operating income 265
368
490
1,175
Interest income 10
1
20
6
Interest expense (70 ) (70 ) (211 ) (212 )
Other income (expense) (5 ) 10
(20 ) 27
Income from continuing operations before income taxes 200
309
279
996
Income tax expense (benefit) 4
25
(139 ) 127
Net income from continuing operations 196
284
418
869
Income (loss) from discontinued operations, net of tax (4 ) 42
857
102
Net income 192
326
1,275
971
Less: Net income attributable to noncontrolling interests 7
7
30
27
Net income attributable to Aon shareholders $ 185
$ 319
$ 1,245
$ 944

Basic net income (loss) per share attributable to Aon shareholders
Continuing operations $ 0.74
$ 1.03
$ 1.49
$ 3.13
Discontinued operations (0.02 ) 0.16
3.28
0.38
Net income $ 0.72
$ 1.19
$ 4.77
$ 3.51
Diluted net income (loss) per share attributable to Aon shareholders
Continuing operations $ 0.73
$ 1.03
$ 1.48
$ 3.11
Discontinued operations (0.01 ) 0.15
3.26
0.37
Net income $ 0.72
$ 1.18
$ 4.74
$ 3.48
Cash dividends per share paid on ordinary shares $ 0.36
$ 0.33
$ 1.05
$ 0.96
Weighted average ordinary shares outstanding - basic 255.6
267.5
260.9
269.1
Weighted average ordinary shares outstanding - diluted 257.3
269.6
262.9
271.0

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Aon plc

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)


	Three Months Ended					Nine Months Ended					Three Months Ended
(millions)	September 30, 2017		September 30, 2016			September 30, 2017		September 30, 2016			March 31, 2019		March 31, 2018
Net income	$	192	$	326		$	1,275	$	971		$	676	$	610
Less: Net income attributable to noncontrolling interests	7		7			30		27			17		16
Net income attributable to Aon shareholders	$	185	$	319		$	1,245	$	944		659		594
Other comprehensive income (loss), net of tax:
Other comprehensive income, net of tax:
Change in fair value of financial instruments	11		—			13		(11		)	7		14
Foreign currency translation adjustments	243		(89		)	434		(227		)	133		247
Postretirement benefit obligation	18		18			56		(132		)	31		48
Total other comprehensive income (loss)	272		(71		)	503		(370		)
Total other comprehensive income											171		309
Less: Other comprehensive income attributable to noncontrolling interests	7		—			3		—			2		3
Total other comprehensive income (loss) attributable to Aon shareholders	265		(71		)	500		(370		)
Total other comprehensive income attributable to Aon shareholders											169		306
Comprehensive income attributable to Aon shareholders	$	450	$	248		$	1,745	$	574		$	828	$	900

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Aon plc

Condensed Consolidated Statements of Financial Position

~~(Unaudited)~~


							(Unaudited)
(millions, except nominal value)	September 30, 2017			December 31, 2016			March 31, 2019			December 31, 2018
ASSETS
CURRENT ASSETS
Assets
Current assets
Cash and cash equivalents	$	749		$	426		$	600		$	656
Short-term investments	1,640			290			134			172
Receivables, net	2,068			2,106			3,242			2,760
Fiduciary assets	9,292			8,959			11,412			10,166
Other current assets	518			247			531			618
Current assets of discontinued operations	—			1,118
Total Current Assets	14,267			13,146
Total current assets							15,919			14,372
Goodwill	7,888			7,410			8,219			8,171
Intangible assets, net	1,341			1,890			1,077			1,149
Fixed assets, net	545			550			606			588
Operating lease right-of-use assets							993			—
Deferred tax assets	565			325			588			561
Prepaid pension	1,020			858			1,224			1,133
Other non-current assets	298			360			509			448
Non-current assets of discontinued operations	—			2,076
TOTAL ASSETS	$	25,924		$	26,615
Total assets							$	29,135		$	26,422

LIABILITIES AND EQUITY
LIABILITIES
CURRENT LIABILITIES
Liabilities and equity
Liabilities
Current liabilities
Accounts payable and accrued liabilities	$	1,588		$	1,604		$	1,479		$	1,943
Short-term debt and current portion of long-term debt	305			336			426			251
Fiduciary liabilities	9,292			8,959			11,412			10,166
Other current liabilities	1,289			656			1,220			936
Current liabilities of discontinued operations	—			940
Total Current Liabilities	12,474			12,495
Total current liabilities							14,537			13,296
Long-term debt	5,662			5,869			5,990			5,993
Non-current operating lease liabilities							978			—
Deferred tax liabilities	83			101			205			181
Pension, other postretirement and postemployment liabilities	1,612			1,760
Pension, other postretirement, and postemployment liabilities							1,590			1,636
Other non-current liabilities	846			719			973			1,097
Non-current liabilities of discontinued operations	—			139
TOTAL LIABILITIES	20,677			21,083
Total liabilities							24,273			22,203

EQUITY
Ordinary shares - $0.01 nominal value Authorized: 750 shares (issued: 2017 - 250.8; 2016 - 262.0)	3			3
Equity
Ordinary shares - $0.01 nominal value Authorized: 750 shares (issued: 2019 - 240.9; 2018 - 240.1)							2			2
Additional paid-in capital	5,670			5,577			5,958			5,965
Retained earnings	2,914			3,807			2,555			2,093
Accumulated other comprehensive loss	(3,412		)	(3,912		)	(3,740		)	(3,909		)
TOTAL AON SHAREHOLDERS' EQUITY	5,175			5,475
Total Aon shareholders' equity							4,775			4,151
Noncontrolling interests	72			57			87			68
TOTAL EQUITY	5,247			5,532
TOTAL LIABILITIES AND EQUITY	$	25,924		$	26,615
Total equity							4,862			4,219
Total liabilities and equity							$	29,135		$	26,422

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Aon plc

Condensed Consolidated ~~Statement~~Statements of Shareholders’ Equity

(Unaudited)


(millions)	Shares		Ordinary Shares and Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss, Net of Tax			Non- controlling Interests			Total			Shares		Ordinary Shares and Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss, Net of Tax			Non- controlling Interests		Total
Balance at December 31, 2016	262.0		$	5,580		$	3,807		$	(3,912	)	$	57		$	5,532
Adoption of new accounting guidance	—		—			49			—			—			49
Balance at January 1, 2017	262.0		5,580			3,856			(3,912		)	57			5,581
Balance at January 1, 2019																		240.1		$	5,967		$	2,093		$	(3,909	)	$	68	$	4,219
Net income	—		—			1,245			—			30			1,275			—		—			659			—			17		676
Shares issued - employee stock compensation plans	3.3		(117		)	—			—			—			(117		)	1.4		(96		)	—			—			—		(96		)
Shares purchased	(14.5	)	—			(1,913		)	—			—			(1,913		)	(0.6	)	—			(101		)	—			—		(101		)
Share-based compensation expense	—		214			—			—			—			214			—		89			—			—			—		89
Dividends to shareholders	—		—			(274		)	—			—			(274		)
Dividends to shareholders ($0.40 per share)																		—		—			(96		)	—			—		(96		)
Net change in fair value of financial instruments	—		—			—			13			—			13			—		—			—			7			—		7
Net foreign currency translation adjustments	—		—			—			431			3			434			—		—			—			131			2		133
Net postretirement benefit obligation	—		—			—			56			—			56			—		—			—			31			—		31
Purchases of shares from noncontrolling interests	—		(4		)	—			—			(1		)	(5		)
Dividends paid to noncontrolling interests on subsidiary common stock	—		—			—			—			(17		)	(17		)
Balance at September 30, 2017	250.8		$	5,673		$	2,914		$	(3,412	)	$	72		$	5,247
Balance at March 31, 2019																		240.9		$	5,960		$	2,555		$	(3,740	)	$	87	$	4,862



(millions)	Shares		Ordinary Shares and Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss, Net of Tax			Non- controlling Interests		Total
Balance at January 1, 2018	247.6		$	5,777		$	2,795		$	(3,497	)	$	65	$	5,140
Net income	—		—			594			—			16		610
Shares issued - employee stock compensation plans	1.5		(109		)	—			—			—		(109		)
Shares purchased	(3.9	)	—			(553		)	—			—		(553		)
Share-based compensation expense	—		77			—			—			—		77
Dividends to shareholders ($0.36 per share)	—		—			(89		)	—			—		(89		)
Net change in fair value of financial instruments	—		—			—			14			—		14
Net foreign currency translation adjustments	—		—			—			244			3		247
Net postretirement benefit obligation	—		—			—			48			—		48
Balance at March 31, 2018	245.2		$	5,745		$	2,747		$	(3,191	)	$	84	$	5,385

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Aon plc

Condensed Consolidated Statements of Cash Flows

(Unaudited)



	Three Months Ended
(millions)	March 31, 2019			March 31, 2018
Cash flows from operating activities
Net income	$	676		$	610
Less: Net income from discontinued operations	—			6
Adjustments to reconcile net income to cash provided by operating activities:
(Gain) loss from sales of businesses, net	(4		)	1
Depreciation of fixed assets	40			39
Amortization and impairment of intangible assets	97			110
Share-based compensation expense	89			77
Deferred income taxes	(25		)	26
Change in assets and liabilities:
Fiduciary receivables	(609		)	(605		)
Short-term investments — funds held on behalf of clients	(541		)	(195		)
Fiduciary liabilities	1,150			800
Receivables, net	(458		)	(269		)
Accounts payable and accrued liabilities	(454		)	(439		)
Restructuring reserves	(25		)	(24		)
Current income taxes	118			30
Pension, other postretirement and postemployment liabilities	(54		)	(53		)
Other assets and liabilities	74			38
Cash provided by operating activities	74			140
Cash flows from investing activities
Proceeds from investments	12			17
Payments for investments	(14		)	(11		)
Net sales of short-term investments — non-fiduciary	41			415
Acquisition of businesses, net of cash acquired	(15		)	(29		)
Sale of businesses, net of cash sold	6			(1		)
Capital expenditures	(57		)	(45		)
Cash provided by (used for) investing activities	(27		)	346
Cash flows from financing activities
Share repurchase	(100		)	(569		)
Issuance of shares for employee benefit plans	(98		)	(109		)
Issuance of debt	871			808
Repayment of debt	(694		)	(704		)
Cash dividends to shareholders	(96		)	(89		)
Noncontrolling interests and other financing activities	(23		)	—
Cash used for financing activities	(140		)	(663		)
Effect of exchange rates on cash and cash equivalents	37			18
Net decrease in cash and cash equivalents	(56		)	(159		)
Cash and cash equivalents at beginning of period	656			756
Cash and cash equivalents at end of period	$	600		$	597
Supplemental disclosures:
Interest paid	$	27		$	58
Income taxes paid, net of refunds	$	33		$	58

Nine Months Ended
(millions) September 30, 2017 September 30, 2016
CASH FLOWS FROM OPERATING ACTIVITIES

Net income $ 1,275
$ 971
Less: Income from discontinued operations, net of income taxes 857
102
Adjustments to reconcile net income to cash provided by operating activities:

Loss (gain) from sales of businesses and investments, net 2
(41 )
Depreciation of fixed assets 148
118
Amortization and impairment of intangible assets 604
117
Share-based compensation expense 214
210
Deferred income taxes (208 ) (7 )
Change in assets and liabilities:

Fiduciary receivables 986
1,538
Short-term investments — funds held on behalf of clients (701 ) (419 )
Fiduciary liabilities (285 ) (1,119 )
Receivables, net 144
175
Accounts payable and accrued liabilities (237 ) (246 )
Restructuring reserves 170
—
Current income taxes (785 ) (80 )
Pension, other postretirement and other postemployment liabilities (142 ) (70 )
Other assets and liabilities (39 ) 107
Cash provided by operating activities - continuing operations 289
1,152
Cash provided by operating activities - discontinued operations 64
323
CASH PROVIDED BY OPERATING ACTIVITIES 353
1,475
CASH FLOWS FROM INVESTING ACTIVITIES

Proceeds from investments 43
31
Payments for investments (55 ) (47 )
Net sale (purchases) of short-term investments — non-fiduciary (1,344 ) (108 )
Acquisition of businesses, net of cash acquired (172 ) (198 )
Sale of businesses, net of cash sold 4,194
104
Capital expenditures (125 ) (107 )
Cash provided by (used for) investing activities - continuing operations 2,541
(325 )
Cash used for investing activities - discontinued operations (19 ) (46 )
CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES 2,522
(371 )
CASH FLOWS FROM FINANCING ACTIVITIES

Share repurchase (1,888 ) (1,037 )
Issuance of shares for employee benefit plans (118 ) (70 )
Issuance of debt 1,651
2,729
Repayment of debt (1,998 ) (2,308 )
Cash dividends to shareholders (274 ) (258 )
Noncontrolling interests and other financing activities (21 ) (71 )
Cash used for financing activities - continuing operations (2,648 ) (1,015 )
Cash used for financing activities - discontinued operations —
—
CASH USED FOR FINANCING ACTIVITIES (2,648 ) (1,015 )
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS 91
10
NET INCREASE IN CASH AND CASH EQUIVALENTS 318
99
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 431
384
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 749
$ 483
Supplemental disclosures:

Interest paid $ 195
$ 196
Income taxes paid, net of refunds $ 854
$ 153

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Notes to Condensed Consolidated Financial Statements (Unaudited)

1.Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements and Notes thereto (the “Financial Statements”) have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). The ~~Condensed Consolidated~~ Financial Statements include the accounts of Aon plc and all of its controlled subsidiaries (“Aon” or the “Company”). ~~All intercompany~~Intercompany accounts and transactions have been eliminated. The ~~Condensed Consolidated~~ Financial Statements include, in the opinion of management, all adjustments (consisting of normal recurring adjustments and reclassifications) necessary to present fairly the Company’s consolidated financial position, results of operations and cash flows for all periods presented.

Certain information and disclosures normally included in the ~~financial statements~~Financial Statements prepared in accordance with U.S. GAAP have been condensed or omitted. These ~~Condensed Consolidated~~ Financial Statements should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2018. The results for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2019 are not necessarily indicative of operating results that may be expected for the full year ending December 31, ~~2017.~~2019.

~~Discontinued Operations~~

On February 9, 2017, the Company entered into a Purchase Agreement (the “Purchase Agreement”) with Tempo Acquisition, LLC (the “Buyer”), an entity formed and controlled by affiliates of The Blackstone Group L.P. Pursuant to the Purchase Agreement, the Company sold its benefits administration and business process outsourcing business (the “Divested Business”) to the Buyer and certain designated purchasers that are direct or indirect subsidiaries of the Buyer (the “Transaction”). As a result, the Divested Business’s financial results are reflected in the Condensed Consolidated Statements of Income, Condensed Consolidated Statements of Financial Position, and Condensed Consolidated Statements of Cash Flows, retrospectively, as discontinued operations beginning in the first quarter of 2017. Additionally, all of the Notes to Condensed Consolidated Financial Statements have been retrospectively restated to only include the impacts of continuing operations, unless noted otherwise. The Transaction closed on May 1, 2017. Refer to Note 3 “Discontinued Operations” for additional information.

~~Reportable Segments~~

Beginning in the first quarter of 2017, the Company began operating as one segment that includes all of Aon’s continuing operations, which provides advice and solutions to clients focused on risk, retirement, and health through five revenue lines that make up our principal products and services. Refer to Note 17 “Segment Information” for additional information.

~~As a result of these initiatives, Aon made the following changes to its presentation of the Condensed Consolidated Statement of Income beginning in the first quarter of 2017:~~

~~Commissions, fees and other and Fiduciary investment income are now reported as one Total revenue line item; and~~

Other general expenses has been further broken out to provide greater clarity into charges related to Information technology, Premises, Depreciation of fixed assets, and Amortization and impairment of intangible assets.

~~Prior period comparable financial information has been reclassified to conform to this presentation.~~

The Company believes this presentation provides greater clarity into the risks and opportunities that management believes are important and allows users of the financial statements to assess the performance in the same way as the Chief Operating Decision Maker (the “CODM”).

Use of Estimates

The preparation of the accompanying ~~Condensed Consolidated~~ Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the ~~financial statements,~~Financial Statements, and the reported amounts of reserves and expenses. These estimates and assumptions are based on management’s best estimates and judgments. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. Management believes its estimates to be reasonable given the current facts available. Aon adjusts such estimates and assumptions when facts and circumstances dictate. Illiquid credit markets, volatile equity markets, and foreign currency exchange rate movements increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in estimates resulting from continuing changes in the economic environment would, if applicable, be reflected in the ~~financial statements~~Financial Statements in future periods.

2. Accounting Principles and Practices

Adoption of New Accounting Standards

~~Share-based Compensation~~Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income

In ~~March 2016,~~February 2018, the ~~Financial Accounting Standards Board (“FASB”)~~FASB issued new accounting guidance related to reclassification of certain tax effects from accumulated other comprehensive income. The guidance allowed a reclassification from accumulated comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017. The guidance was effective for the Company in the first quarter of 2019. There was no impact on ~~several aspects~~the net income of the ~~accounting for share-based payment transactions, including the income tax consequences, classification of awards~~Company as either equity or liabilities, and classification on the statement of cash flows. The new guidance requires all excess tax benefits and tax deficiencies to be recognized as income tax expense or benefit in the income statement and treated as discrete items in the reporting period. Further, excess tax benefits are required to be classified along with other income tax cash flows as an operating activity. Amendments related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements, forfeitures, and intrinsic value should be applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. Amendments related to the presentation of employee taxes paid on the statement of cash flows when an employer withholds shares to meet the minimum statutory withholding requirement should be applied retrospectively. Amendments requiring recognition of excess tax benefits and tax deficiencies in the income statement and the practical expedient for estimating expected term should be applied prospectively. An entity mayAon did not elect to ~~apply the amendments related to the presentation of excess~~reclassify stranded tax ~~benefits on the statement of cash flows using either a prospective transition method or a retrospective transition method.~~

~~The Company adopted this guidance on January 1, 2017, with the following impacts:~~

~~An increase to Deferred tax assets~~effects on the Condensed Consolidated Statement of Financial ~~Position of approximately $49 million through a cumulative-effect adjustment~~Position. It is the Company’s policy to ~~Retained earnings for excess tax benefits not previously recognized, and~~

~~The recognition of $5 million, or $0.02 per share,~~release income tax ~~benefit~~effects from ~~continuing operations related to excess tax benefits in~~accumulated other comprehensive loss using the ~~Condensed Consolidated Statement of Income for the three months ended September 30, 2017, and $53 million, or $0.20 per share, for the nine months ended September 30, 2017.~~

Adoption of the guidance was applied prospectively on the Condensed Consolidated Statement of Cash Flows and prior period comparable information was not restated. Other elements of the guidance did not have a material impact on the Company’s Condensed Consolidated Financial Statements.

~~Accounting Standards Issued But Not Yet Adopted~~portfolio approach.

Targeted Improvements to Accounting for Hedging Activities

In August 2017, the FASB issued new accounting guidance on targeted improvements to accounting for hedging activities. The new guidance ~~amends~~amended its hedge accounting model to enable entities to better portray their risk management activities in the financial statements. The guidance ~~eliminates~~eliminated the requirement to separately measure and report hedge ineffectiveness and ~~requires~~required the effect of a hedging instrument to be presented in the same income statement line as the hedged item. ~~An entity will apply~~The new guidance was effective for Aon in the ~~new guidance~~first quarter of 2019 and the Company adopted it on a modified retrospective basis with ano cumulative effect adjustment to accumulated other comprehensive income ~~with a~~or corresponding adjustment to ~~retained earnings~~Retained earnings. Changes to the Condensed Consolidated Statement of Income and financial statement disclosures were applied prospectively. Under the new guidance, gains or losses on derivative hedges are recognized in revenue as compared to other income (expense) under the previous guidance. The adoption of this guidance had no impact on the net income of the Company.

Leases

In February 2016, the FASB issued a new accounting standard on leases, which requires lessees to recognize assets and liabilities for most leases. Under the new standard, a lessee is required to recognize in the Consolidated Statements of Financial Position, liabilities to make future lease payments and right-of-use (“ROU”) assets representing its right to use the underlying assets for the lease term. The recognition, measurement, timing, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from previous U.S. GAAP.

The Company adopted the new standard as of January 1, 2019, using the ~~beginning~~modified retrospective approach for all leases existing at, or entered into after, the period of adoption. Under this approach, prior periods were not restated. Rather, lease balances and other disclosures for prior periods were provided in the notes to the financial statements as previously reported, and the cumulative effect of initially applying the guidance was recognized in the Condensed Consolidated Statement of Financial Position.

The modified retrospective approach includes several optional practical expedients available that entities may elect to apply upon transition. These practical expedients relate to the identification and classification of leases that commenced before the effective date, initial direct costs for leases that commenced before the effective date, and the ability to use hindsight in evaluating lessee options to extend or terminate a lease or to purchase the underlying asset. The Company elected the package of practical expedients permitted under the transition guidance within the new standard, which allows a lessee to carryforward their population of existing leases, the classification of each lease, as well as the treatment of initial direct costs as of the period of adoption. In addition, the Company elected the practical expedient related to lease and non-lease components, as an accounting policy election for all asset classes, which allows a lessee to not separate non-lease from lease components and instead account for consideration paid in a contract as a single lease component. Lastly, the Company did not elect the practical expedient related to hindsight analysis which allows a lessee to use hindsight in determining the lease term and in assessing impairment of the entity’s ROU assets.

The Company has made a policy election to not recognize ROU assets and lease liabilities that arise from leases with an initial term of twelve months or less on the Condensed Consolidated Statements of Financial Position. However, the Company will recognize these lease payments in the Condensed Consolidated Statements of Income on a straight-line basis over the lease term and variable lease payments in the period in which the obligation is incurred. The Company has chosen to apply this accounting policy across all classes of underlying assets. Additionally, upon adoption, the Company utilized a discount rate to determine the present value of the lease payments based on information available as of January 1, 2019.

Beginning January 1, 2019, operating ROU assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term at the commencement date. Operating leases in effect prior to January 1, 2019 were recognized at the present value of the remaining payments on the remaining lease term as of January 1, 2019. Upon adoption, the Company recognized ROU assets and lease liabilities of $1.1 billion and $1.3 billion, respectively. The standard had an insignificant impact on the Condensed Consolidated Statements of Income and no impact on the Condensed Consolidated Statements of Cash Flows. Refer to Note 20 “Lease Commitments” for further information including significant assumptions and judgments made.

As a result of applying the modified retrospective approach to adopt the new leasing standard, the following adjustments were made to the Condensed Consolidated Statements of Financial Position as of January 1, 2019 (in millions):



	December 31, 2018					January 1, 2019
	As Reported		Adjustments			As Adjusted
Assets
Operating lease right-of-use assets	$	—	$	1,021		$	1,021
Other non-current assets	$	448	$	78		$	526

Liabilities
Other current liabilities	$	936	$	219		$	1,155
Non-current operating lease liabilities	$	—	$	1,014		$	1,014
Other non-current liabilities	$	1,097	$	(134	)	$	963

Accounting Standards Issued But Not Yet Adopted

Changes to ~~income statement presentation~~the Disclosure Requirements for Defined Benefit Plans

In August 2018, the FASB issued new accounting guidance related to the disclosure requirements for employers that sponsor defined benefit pension and ~~financial statement~~other postretirement benefit plans. The guidance requires sponsors of these plans to provide additional disclosures, ~~will be applied prospectively.~~including weighted average interest rates used in the entity’s cash balance pension plans and a narrative description of reasons for any significant gains or losses impacting the benefit obligation for the period, and eliminates certain previous disclosure requirements. The ~~new~~ guidance is effective for Aon in the first quarter of ~~2019 and~~2021 with early adoption ~~is permitted.~~permitted and will be applied retrospectively. The Company is currently evaluating the impact that the ~~standard~~guidance will have on the ~~Condensed Consolidated~~ Financial Statements and the period ~~in which it plans to adopt.~~

~~Presentation~~ of ~~Net Periodic Pension and Postretirement Benefit Costs~~

In March 2017, the FASB issued new accounting guidance on the presentation of net periodic pension cost and net periodic postretirement benefit cost. The new guidance requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. It also requires the other components of net periodic pension cost and net periodic postretirement benefit cost to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. Additionally, only the service cost component is eligible for capitalization, when applicable. An entity will apply the new guidance retrospectively for the presentation of the service cost component and the other components of net periodic pension cost and net periodic postretirement benefit cost in the Condensed Consolidated Statement of Income and prospectively, on and after the effective date, for the capitalization of the service cost component of net periodic pension costs and net periodic postretirement benefit cost in assets. The new guidance allows a practical expedient that permits an employer to use the amounts disclosed in its pension and other postretirement benefit plan note for the prior comparative periods as the estimation basis for applying the retrospective presentation requirements. The new guidance is effective for Aon in the first quarter of 2018. The adoption of thisadoption.

guidance will have no impact on the total results of the Company. The presentation of results will reflect a change in Operating income offset by an equal change in Other income (expense) for the period.

Simplifying the Test for Goodwill Impairment

In January 2017, the FASB issued new accounting guidance on simplifying the test for goodwill impairment. Currently the standard requires an entity to perform a two-step test to determine the amount, if any, of goodwill impairment. In Step 1, an entity compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of the reporting unit exceeds its fair value, the entity performs Step 2 and compares the implied fair value of goodwill with the carrying amount of that goodwill for that reporting unit. An impairment charge equal to the amount by which the carrying amount of goodwill for the reporting unit exceeds the implied fair value of that goodwill is recorded, limited to the amount of goodwill allocated to that reporting unit. The new guidance removes Step 2. An entity will apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not amend the optional qualitative assessment of goodwill impairment. An entity will apply the new guidance on a prospective basis. The new guidance is effective for Aon in the first quarter of 2020 and early adoption is ~~permitted for annual goodwill impairment tests performed on testing dates after January 1, 2017.~~permitted. The Company is currently evaluating the period of adoption, ~~and the impact that the standard will have on the Condensed Consolidated Financial Statements.~~

~~Income Tax Consequences of Intercompany Transactions~~

In October 2016, the FASB issued new accounting guidance on the income tax consequences of intra-entity asset transfers other than inventory. The guidance will require that the seller and buyer recognize the consolidated current and deferred income tax consequences ofbut does not expect a transaction in the period the transaction occurs rather than deferring to a future period and recognizing those consequences when the asset has been sold to an outside party or otherwise recovered through use (i.e., depreciated, amortized, or impaired). An entity will apply the new guidance on a modified retrospective basis with a cumulative effect adjustment to retained earnings as of the beginning of the period of adoption. The new guidance is effective for Aon in the first quarter of 2018, and the Company is currently evaluating the impact that the standard will have on the Condensed Consolidated Financial Statements.

~~Statement of Cash Flows~~

In August 2016, the FASB issued new accounting guidance on the classification of certain cash receipts and cash payments. Under the new guidance, an entity will no longer have discretion to choose the classification for a number of transactions, including contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, and distributions received from equity method investees. The new standard will be effective for the Company in the first quarter of 2018, with early adoption permitted. An entity will apply the new guidance through retrospective adjustment to all periods presented. The retrospective approach includes a practical expedient that entities may apply should retrospective adoption be impracticable; in this case, the amendments for these issues may be applied prospectively as of the earliest date practicable. The guidance will not have a materialsignificant impact on the ~~Company’s Condensed Consolidated Statements of Cash Flows.~~Financial Statements.

Credit Losses

In June 2016, the FASB issued a new accounting ~~guidance~~standard on the measurement of credit losses on financial instruments. The new ~~guidance~~standard replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. An entity will apply the new ~~guidance~~standard through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the ~~guidance~~standard is effective. The ~~guidance~~standard is effective for Aon in the first quarter of 2020 and early adoption is ~~permitted beginning in the first quarter of 2019. Aon~~permitted. The Company is currently evaluating the impact that the standard will have on ~~the Condensed Consolidated~~its Financial Statements ~~as well as~~and the ~~method of transition and~~ period of adoption.

~~Leases~~

In February 2016, the FASB issued new accounting guidance on leases, which requires lessees to recognize assets and liabilities for most leases. Under the new guidance, a lessee should recognize in the Condensed Consolidated Statement3. Revenue from Contracts with Customers

Disaggregation of ~~Financial Position a liability to make lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term.~~ Revenue

The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from currently effective U.S. GAAP. The new standard will be effective for the Company in the first quarter of 2019, with early adoption permitted. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The modified retrospective approach includes a number of optional practical expedients that entities may elect to apply. These practical expedients relate to the identification and classification of leases that commenced before the effective date, initial direct costs for leases that commenced before the effective date, and

the ability to use hindsight in evaluating lessee options to extend or terminate a lease or to purchase the underlying asset. Aon is currently evaluating the impact the standard will have on the Condensed Consolidated Financial Statements and period of adoption.

~~Financial Assets and Liabilities~~

In January 2016, the FASB issued new accounting guidance on recognition and measurement of financial assets and financial liabilities. The amendments in the new guidance make targeted improvements, which include the requirement to measure equity investments with readily determinable fair values at fair value through net income, simplification of the impairment assessment for equity investments without readily determinable fair values, adjustments to existing and additional disclosure requirements, and additional tax considerations. An entity should apply the amendments by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. The amendments related to equity securities without readily determinable fair values, including disclosure requirements, should be applied prospectively to equity investments that exist as of the date of adoption of the guidance. The guidance is effective for the Company in the first quarter of 2018 and early adoption is permitted. Aon is currently evaluating the impact that the standard will have on the Condensed Consolidated Financial Statements and period of adoption.

~~Revenue Recognition~~

~~In May 2014, the FASB issued a new accounting standard on~~following table summarizes revenue from contracts with customers by principal service line (in millions):



	Three Months Ended March 31
	2019			2018
Commercial Risk Solutions	$	1,118		$	1,184
Reinsurance Solutions	788			742
Retirement Solutions	420			424
Health Solutions	486			451
Data & Analytic Services	336			294
Elimination	(5		)	(5		)
Total revenue	$	3,143		$	3,090

Consolidated revenue from contracts with customers by geographic area, which ~~when effective, will supersede nearly all existing revenue recognition guidance under U.S. GAAP. The core principal~~is attributed on the basis of where the services are performed, is as follows (in millions):



	Three Months Ended March 31
	2019		2018
United States	$	1,161	$	1,116
Americas other than United States	226		237
United Kingdom	452		484
Europe, Middle East, & Africa other than United Kingdom	1,009		979
Asia Pacific	295		274
Total revenue	$	3,143	$	3,090

Contract Costs

An analysis of the standard is that an entity should recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in ~~judgments and assets recognized from~~the net carrying amount of costs ~~incurred~~ to ~~obtain or~~ fulfill ~~a contract. The standard is effective for Aon~~contracts with customers are as follows (in millions):



As of	March 31, 2019			December 31, 2018
Balance at beginning of period	$	329		$	298
Additions	346			1,504
Amortization	(439		)	(1,465		)
Impairment	—			—
Foreign currency translation and other	—			(8		)
Balance at end of period	$	236		$	329

An analysis of the changes in the first quarter of 2018 and early adoption is permitted beginning in the first quarter of 2017. Two methods of transition are permitted upon adoption: full retrospective and modified retrospective. Under the full retrospective method, prior periods would be restated under the new revenue standard, providing a comparable view across all periods presented. Under the modified retrospective method, prior periods would not be restated. Rather, revenue and other disclosures for pre-2018 periods would be provided in the notes to the financial statements as previously reported under the current revenue standard. The Company will adopt this standard in the first quarter of 2018 using a modified retrospective adoption approach.

A preliminary assessment to determine the impacts of the new accounting standard has been performed. The Company is currently implementing accounting and operational processes and controls to ensure compliance with the new standard, but is still evaluating the quantitative impacts the standard will have on its financial statements.

~~However, the more significant impacts of the new standard to the Company are anticipated to be as follows:~~

The Company currently recognizes revenue either at a point in time or over a period of time based on the transfer of value to customers or as the remuneration becomes determinable. Under the new standard, the revenue related to certain brokerage activities recognized over a period of time will be recognized on the effective date of the associated policies when control of the policy transfers to the customer. As a result, revenue from these arrangements will be recognized in earlier periods under the new standard in comparison to the current guidance and will change the timing andnet carrying amount of revenue recognized for annual and interim periods. This change is anticipated to result in a significant shift in interim revenue for Reinsurance Solutions and certain other brokerage services. The Company is currently assessing the timing and measurement of revenue recognition under the new standard for certain other services, including advisory, where limited impacts are anticipated.

Additionally, the new standard provides guidance on accounting for certain revenue-related costs including when to capitalize costs associated with obtaining and fulfilling a contract. The majority of these costs are currently expensed as incurred under existing U.S. GAAP. Assets recognized for the costs to obtain ~~a contract, which includes certain sales commissions, will be amortized on a systematic basis that is consistent~~contracts with ~~the transfer of the services to which the asset relates, considering anticipated renewals when applicable. For situations where the renewal period is one year or less and renewal costs~~customers are ~~commensurate with the initial contract, the Company plans to apply a practical expedient and recognize the costs of obtaining a contract~~ as an expense when incurred. Assets recognized for the costs to fulfill a contract, which includes internal costs related to pre-placement broking activities, will be amortized on a systematic basis that is consistent with the transfer of the services to which the asset relates, which is generally expected to be less than one year. The Company is quantifying the nature and amount of costs that would qualify for capitalization and the amount of amortization that will be recognized in each period.

3.~~Discontinued Operations~~

On February 9, 2017, the Company entered into the Purchase Agreement with Tempo Acquisition, LLC to sell its benefits administration and business process outsourcing business to the Buyer, an entity formed and controlled by affiliates of The Blackstone Group L.P., and certain designated purchasers that are direct or indirect subsidiaries of the Buyer.

On May 1, 2017, the Buyer purchased all of the outstanding equity interests of the Divested Business, plus certain related assets and liabilities, for a purchase price of $4.3 billion in cash paid at closing, subject to customary adjustments set forth in the Purchase Agreement, and deferred consideration of up to $500 million. Cash proceeds after customary adjustments and before taxes due were $4.2 billion.

Aon and the Buyer entered into certain transaction related agreements at the closing, including two commercial agreements, a transition services agreement, certain intellectual property license agreements, sub-leases and other customary agreements. Aon expects to continue to be a significant client of the Divested Business and the Divested Business has agreed to use Aon for its broking and other services for a specified period of time.

In the nine months ended September 30, 2017, the Company recorded an estimated gain on sale, net of taxes, of $803 million and a non-cash impairment charge to its tradenames associated with the Divested Business of $380 million as these assets were not sold to the Buyer. The impairment charge is included in Amortization and impairment of intangible assets on the Condensed Consolidated Statement of Income for the nine months ended September 30, 2017.

The Company has classified the results of the Divested Business as discontinued operations in the Company’s Condensed Consolidated Statements of Income for all periods presented. Additionally, the assets and liabilities of the Divested Business were retrospectively classified as discontinued operations in the Company’s Condensed Consolidated Statements of Financial Position upon triggering held for sale criteria in February 2017. These assets and liabilities were sold on May 1, 2017.

The financial results of the Divested Business for the three and nine months ended September 30, 2017 and 2016 are presented as Income from discontinued operations on the Company’s Condensed Consolidated Statements of Income. The following table presents the financial results of the Divested Businessfollows (in millions):



As of	March 31, 2019			December 31, 2018
Balance at beginning of period	$	156		$	145
Additions	9			53
Amortization	(11		)	(41		)
Impairment	—			—
Foreign currency translation and other	1			(1		)
Balance at end of period	$	155		$	156

Three months ended September 30 Nine months ended September 30

2017 2016 2017 2016
Revenue
Total revenue $ —
$ 559
$ 698
$ 1,606
Expenses
Total operating expenses 14
491
640
1,443
Operating income from discontinued operations (14 ) 68
58
163
Other income (1 ) (1 ) 10
—
Income from discontinued operations before income taxes (15 ) 67
68
163
Income taxes (6 ) 25
14
61
Income from discontinued operations excluding gain, net of tax (9 ) 42
54
102
Gain on sale of discontinued operations, net of tax 5
—
803
—
Income from discontinued operations, net of tax $ (4 ) $ 42
$ 857
$ 102

Upon triggering held for sale criteria in February 2017, Aon ceased depreciating and amortizing all long-lived assets included in discontinued operations. No depreciation or amortization expense was recognized during the three months ended September 30, 2017. Included within Total operating expenses for the three months ended September 30, 2016 was $18 million of depreciation of fixed assets and $30 million of intangible asset amortization. Total operating expenses for the nine months ended September 30, 2017 and 2016 include, respectively, $8 million and $53 million of depreciation of fixed assets and $11 million and $90 million of intangible asset amortization.

The following table presents the aggregate carrying amounts of the classes of assets and liabilities presented as discontinued operations within the Company’s Condensed Consolidated Statements of Financial Position (in millions):

September 30,
2017 ⁽¹⁾
December 31,
2016
ASSETS

Cash and cash equivalents $ —
$ 5
Receivables, net —
483
Fiduciary assets —
526
Goodwill —
1,337
Intangible assets, net —
333
Fixed assets, net —
215
Other assets —
295
TOTAL ASSETS $ —
$ 3,194

LIABILITIES

Accounts payable and accrued liabilities $ —
$ 197
Fiduciary liabilities —
526
Other liabilities —
356
TOTAL LIABILITIES $ —
$ 1,079


~~(1)~~	~~All assets and liabilities associated with the Divested Business were sold on May 1, 2017.~~

The Company’s Condensed Consolidated Statements of Cash Flows present the operating, investing, and financing cash flows of the Divested Business as discontinued operations. Aon uses a centralized approach to cash management and financing of its operations. Prior to the closing of the Transaction, portions of the Divested Business’s cash were transferred to Aon daily, and Aon would fund the Divested Business as needed. Cash and cash equivalents of discontinued operations at September 30, 2016 was $3 million.

4. Cash and Cash Equivalents and Short-term Investments

Cash and cash equivalents include cash balances and all ~~highly-liquid~~highly liquid instruments with initial maturities of three months or less. Short-term investments consist of money market funds. The estimated fair value of cash and cash equivalents and short-term investments approximates their carrying values.

At ~~September 30, 2017,~~March 31, 2019, Cash and cash equivalents and Short-term investments were ~~$2,389~~$734 million compared to ~~$716~~$828 million at December 31, ~~2016, an increase~~2018, a decrease of ~~$1,673 million that was primarily related to the receipt of proceeds from the sale of the Divested Business.~~$94 million. Of the total balances, ~~$98~~$140 million and ~~$82~~$91 million ~~was~~were restricted as to ~~its~~their use at ~~September 30, 2017~~March 31, 2019 and December 31, ~~2016,~~2018, respectively. Included within ~~the September 30, 2017~~Cash and cash equivalents as of March 31, 2019, was $48 million of pledged cash, which was released on April 1, 2019. Included within Short-term investments as of March 31, 2019 and December 31, ~~2016 balances, respectively, were~~2018 was £42.7 million ($~~57.5~~56.4 million at ~~September 30, 2017~~March 31, 2019 exchange ~~rates)~~rates and ~~£43.3 million ($53.2~~$53.9 million at December 31, ~~2016~~2018 exchange rates) of operating funds required to be held by the Company in the United Kingdom (the “U.K.”) by the Financial Conduct Authority (the “FCA”), a U.K.-based ~~regulator, which were included in Short-term investments.~~regulator.

5. Other Financial Data

Condensed Consolidated Statements of Income Information

Other Income (Expense)

Other income (expense) consists of the following (in millions):



	Three Months Ended March 31
	2019			2018
Foreign currency remeasurement	$	(11	)	$	(16	)
Disposal of business	5			(1		)
Pension and other postretirement	4			2
Equity earnings	1			1
Financial instruments	1			—
Other	—			(1		)
Total	$	—		$	(15	)

Three months ended September 30 Nine months ended September 30
2017 2016 2017 2016
Foreign currency remeasurement gain (loss) $ (20 ) $ 3
$ (32 ) $ (14 )
Gain (loss) on disposal of business —
—
(2 ) 41
Equity earnings 2
4
11
7
Gain (loss) on financial instruments 16
3
6
(7 )
Other (3 ) —
(3 ) —
Total $ (5 ) $ 10
$ (20 ) $ 27

Condensed Consolidated Statements of Financial Position Information

Allowance for Doubtful Accounts

An analysis of the allowance for doubtful accounts isare as follows (in millions):



	Three Months Ended March 31
	2019			2018
Balance at beginning of period	$	64		$	59
Provision charged to Other general expenses	8			8
Accounts written off, net of recoveries	(8		)	(3		)
Foreign currency translation and other	—			1
Balance at end of period	$	64		$	65

Three months ended September 30 Nine months ended September 30
2017 2016 2017 2016
Balance at beginning of period $ 59
$ 64
$ 56
$ 58
Provision charged to Other general expenses 5
4
16
15
Accounts written off, net of recoveries —
(5 ) (10 ) (11 )
Foreign currency translation (5 ) —
(3 ) 1
Balance at end of period $ 59
$ 63
$ 59
$ 63

Other Current Assets

The components of Other current assets are as follows (in millions):



As of	March 31, 2019		December 31, 2018
Costs to fulfill contracts with customers ⁽¹⁾	$	236	$	329
Prepaid expenses	108		97
Taxes receivable	81		113
Other ⁽²⁾	106		79
Total	$	531	$	618

As of September 30, 2017 December 31, 2016
Taxes receivable $ 208
$ 100
Prepaid expenses 158
102
Receivables from the Divested Business ⁽¹⁾
124
—
Other 28
45
Total $ 518
$ 247


(1)	Refer to Note 3 ~~“Discontinued Operations”~~“Revenue from Contracts with Customers” for ~~additional~~further information.


(2)	December 31, 2018 includes $12 million previously classified as “Receivables from the Divested Business”.

Other Non-Current Assets

The components of Other non-current assets are as follows (in millions):



As of	March 31, 2019		December 31, 2018
Costs to obtain contracts with customers ⁽¹⁾	$	155	$	156
Taxes receivable	99		100
Leases ⁽²⁾	70		—
Investments	55		54
Other	130		138
Total	$	509	$	448

As of September 30, 2017 December 31, 2016
Investments $ 44
$ 119
Taxes receivable 88
82
Other 166
159
Total $ 298
$ 360


(1)	Refer to Note 3 “Revenue from Contracts with Customers” for further information.


(2)	Refer to Note 20 “Lease Commitments” for further information.

Other Current Liabilities

The components of Other current liabilities are as follows (in millions):



As of	March 31, 2019		December 31, 2018
Deferred revenue ⁽¹⁾	$	305	$	251
Leases ⁽²⁾	241		—
Taxes payable	158		83
Other	516		602
Total	$	1,220	$	936

As of September 30, 2017 December 31, 2016
Deferred revenue $ 331
$ 199
Taxes payable ⁽¹⁾
537
77
Other 421
380
Total $ 1,289
$ 656


(1)	~~Includes accrued taxes payable related~~During the Three Months Ended March 31, 2019, and twelve months ended December 31, 2018, $134 million and $487 million, respectively, was recognized in the Condensed Consolidated Statement of Income.


(2)	Refer to ~~the gain on sale of the Divested Business.~~Note 20 “Lease Commitments” for further information.

Other Non-Current Liabilities

The components of Other non-current liabilities are as follows (in millions):



As of	March 31, 2019		December 31, 2018
Taxes payable ⁽¹⁾	$	596	$	585
Leases	50		169
Deferred revenue	60		65
Compensation and benefits	44		56
Other	223		222
Total	$	973	$	1,097

As of September 30, 2017 December 31, 2016
Taxes payable $ 333
$ 288
Deferred revenue 45
49
Leases 145
136
Compensation and benefits 61
56
Other 262
190
Total $ 846
$ 719
(1) Includes $238 million and $240 million for the non-current portion of the Transition Tax as of March 31, 2019 and December 31, 2018, respectively.

6.Discontinued Operations

6. ~~Acquisitions~~On February 9, 2017, the Company entered into a Purchase Agreement with Tempo Acquisition, LLC (the “Purchase Agreement”) to sell its benefits administration and ~~Dispositions~~business process outsourcing business (the “Divested Business”) to an entity formed and controlled by affiliates of ~~Businesses~~The Blackstone Group L.P. (the “Buyer”) and certain designated purchasers that are direct or indirect subsidiaries of the Buyer.

~~Acquisitions~~On May 1, 2017, the Buyer purchased all of the outstanding equity interests of the Divested Business, plus certain related assets and liabilities, for a purchase price of $4.3 billion in cash paid at closing, subject to customary adjustments set forth in the Purchase Agreement, and deferred consideration of up to $500 million (the “Transaction”). Cash proceeds after customary adjustments and before taxes due were $4.2 billion.

Aon and the Buyer entered into certain transaction related agreements at the closing, including two commercial agreements, a transition services agreement, certain intellectual property license agreements, sub-leases, and other customary agreements. Aon expects to continue to be a significant client of the Divested Business and the Divested Business has agreed to use Aon for its broking and other services for a specified period of time.

The ~~Company completed eight acquisitions during~~financial results of the ~~nine~~Divested Business for the three months ended ~~September 30, 2017~~March 31, 2019 and ~~eight acquisitions during~~2018 are presented as Income from discontinued operations on the ~~twelve months ended December 31, 2016.~~Company’s Condensed Consolidated Statements of Income. The following table ~~includes~~presents the ~~fair values~~financial results of ~~consideration transferred, assets acquired,~~the Divested Business (in millions):



	Three Months Ended March 31
	2019		2018
Expenses
Total operating expenses	$	—	$	3
Loss from discontinued operations before income taxes	—		(3		)
Income tax benefit	—		(1		)
Net loss from discontinued operations excluding gain	—		(2		)
Gain on sale of discontinued operations, net of tax	—		8
Net income from discontinued operations	$	—	$	6

There were no Cash and ~~liabilities assumed~~cash equivalents of discontinued operations at March 31, 2019. Total proceeds received for the sale of the divested business and taxes paid as a result of the ~~Company’s acquisitions (in millions):~~

For the nine months ended September 30, 2017
Cash $ 164
Deferred and contingent consideration 32
Aggregate consideration transferred $ 196

Assets acquired:
Cash and cash equivalents $ 7
Receivables, net 11
Goodwill 121
Intangible assets, net 90
Fixed assets, net 1
Other assets 10
Total assets acquired 240
Liabilities assumed:
Current liabilities 18
Other non-current liabilities 26
Total liabilities assumed 44
Net assets acquired $ 196

~~The results of operations of these acquisitions~~sale are included in the Condensed Consolidated Financial Statements as of the respective acquisition dates. The Company’s results of operations would not have been materially different if these acquisitions had been reported from the beginning of the period in which they were acquired.

~~2017 Acquisitions~~

On August 31, 2017, the Company completed the transaction to acquire Mark Kelly Insurance and Financial Services PTY LTD, an Australia-based broker servicing the insurance needs of commercial clients in and around the Townsville regional center.

~~On August 28, 2017, the Company completed the transaction to acquire a certain portfolio in the Charlotte office of The Hays Group, Inc. d/b/a Hays Companies.~~

~~On July 27, 2017, the Company completed the transaction to acquire Grupo Innovac Sociedad de Correduría de Seguros, S.A, an insurance broker based in Valencia, Spain.~~

~~On July 3, 2017, the Company completed the transaction to acquire PWZ AG, an independent insurance broker based in Zurich, Switzerland.~~

On May 31, 2017, the Company completed the transaction to acquire SchneiderGolling IFFOXX Assekuranzmakler AG and SchneiderGolling Industrie Assekuranzmaklergesellschaft mbH from SchneiderGolling Gruppe, a property and casualty broker based in Southern Germany.

~~On May 2, 2017, the Company completed the transaction to acquire cut-e Assessment Global Holdings Limited, a high-volume online psychometric assessments provider based in Ireland.~~

~~On March 3, 2017, the Company completed the transaction to acquire Finaccord Limited, a market research, publishing and consulting company based in the United Kingdom.~~

~~On January 19, 2017, the Company completed the transaction to acquire VERO Management AG, an insurance broker and risk advisor based in Austria.~~

~~2016 Acquisitions~~

~~On December 26, 2016, the Company completed the transaction to acquire Admix, a leading health and benefits brokerage and solutions firm based in Brazil.~~

~~On November 11, 2016 the Company completed the transaction to acquire CoCubes, a leading hiring assessment company based in India.~~

On October 31, 2016, the Company completed the transaction to acquire Stroz, Friedberg, Inc., a leading global cyber risk management firm based in New York City, with offices across the U.S. and in London, Zurich, Dubai and Hong Kong.

On August 19, 2016, the Company completed the transaction to acquire Cammack Health LLC, a leading health and benefits consulting firm that serves large health care organizations in the Eastern region of the U.S., including health plans, health systems and employers.

~~On June 1, 2016, the Company completed the transaction to acquire Univers Workplace Solutions, a leading elective benefit enrollment and communication services firm based in New Jersey.~~

~~On April 11, 2016, the Company completed the transaction to acquire Nexus Insurance Brokers Limited and Bayfair Insurance Centre Limited, insurance brokerage firms located in New Zealand.~~

~~On February 1, 2016, the Company completed the transaction to acquire Modern Survey, an employee survey and talent analytics solutions provider based in Minneapolis.~~

~~On January 1, 2016, the Company completed the transaction to acquire Globe Events Management, an insurance, retirement, and investment consulting business company based in Australia.~~

~~Dispositions~~

The Company completed no dispositions during the three months ended September 30, 2017 and four dispositions during the nine months ended September 30, 2017, excluding the sale of the Divested Business. Refer to Note 3 “Discontinued Operations” for further information. The Company completed no dispositions during the three months ended September 30, 2016 and four dispositions during the nine months ended September 30, 2016.

~~There were no gains~~ recognized on the disposition of businesses for the three months ended September 30, 2017 and 2016, excluding the sale of the Divested Business. Total pretax losses recognized, net of gains, were $2 million for the nine months ended September 30, 2017, and total pretax gains recognized, net of losses, were $41 million for the nine months ended September 30, 2016. Gains and losses recognized as a result of a disposition are included in Other income (expense) in the Condensed Consolidated Statements of ~~Income.~~Cash Flows in Cash provided by investing activities - continuing operations and Cash provided by operating activities - continuing operations, respectively.

7. Restructuring

In 2017, Aon initiated a global restructuring plan (the “Restructuring Plan”) in connection with the sale of the Divested Business. The Restructuring Plan is intended to streamline operations across the organization and deliver greater efficiency, insight, and connectivity. The Company expects these restructuring activities and related expenses to affect continuing operations through the

fourth quarter of 2019, including an estimated ~~2,400~~4,800 to ~~2,850~~5,400 role eliminations. In the fourth quarter of 2018, Aon expanded the Restructuring Plan, which resulted in additional expected costs of approximately $200 million, consisting of $150 million of cash investment and $50 million of non-cash charges.

The Restructuring Plan is expected to result in cumulative costs of approximately ~~$750~~$1,225 million through the end of the plan, consisting of approximately ~~$303~~$450 million in employee termination costs, ~~$146~~$130 million in technology rationalization costs, ~~$80~~$65 million in lease consolidation costs, ~~$40~~$50 million in non-cash asset impairments, and ~~$181~~$530 million in other costs, including certain separation costs associated with the sale of the Divested Business. ~~Included in the estimated $750 million are $50 million of non-cash charges related to asset impairments and lease consolidations.~~

From the inception of the Restructuring Plan through ~~September 30, 2017,~~March 31, 2019, the Company has eliminated ~~2,125~~4,491 positions and incurred total expenses of ~~$401~~$1,073 million for restructuring and related separation costs. These charges are included in Compensation and benefits, Information technology, Premises, Depreciation of fixed assets, and Other general expenses in the accompanying Condensed Consolidated Statements of Income.

The following table summarizes restructuring and separation costs by type that have been incurred through ~~September 30, 2017~~March 31, 2019 and are estimated to be incurred through the end of the Restructuring Plan (in millions). Estimated costs by type may be revised in future periods as these assumptions are updated:


	Three months ended September 30, 2017		Nine months ended September 30, 2017		Estimated Remaining Costs		Estimated Total Cost ⁽¹⁾		Three Months Ended March 31, 2019		Inception to Date		Estimated Remaining Costs		Estimated Total Cost ⁽¹⁾
Workforce reduction	$	52	$	257	$	46	$	303	$	24	$	438	$	12	$	450
Technology rationalization ⁽²⁾	12		22		124		146		11		91		39		130
Lease consolidation ⁽²⁾	4		8		72		80		9		45		20		65
Asset impairments	2		26		14		40		—		39		11		50
Other costs associated with restructuring and separation ^{(2) (3)}	32		88		93		181		47		460		70		530
Total restructuring and related expenses	$	102	$	401	$	349	$	750	$	91	$	1,073	$	152	$	1,225

(1)

Actual costs, when incurred, may vary due to changes in the assumptions built into the Restructuring Plan. Significant assumptions that may change when plans are finalized and implemented include, but are not limited to, changes in severance calculations, changes in the assumptions underlying sublease loss calculations due to changing market conditions, and changes in the overall analysis that might cause the Company to add or cancel component initiatives.

(2)

~~Contract~~Total contract termination costs ~~included within~~incurred under the Restructuring Plan associated with Technology ~~rationalization for the three and nine months ended September 30, 2017 were $1 million. Contract termination costs included within~~rationalizations, Lease consolidations, ~~for the three~~ and ~~nine months ended September 30, 2017 were $3 million and $8 million, respectively. Contract termination costs included within~~ Other costs associated with restructuring and separation, respectively, for the three months ended March 31, 2019 were $1 million, ~~for~~$9 million, and $2 million; and since inception of the ~~three~~Restructuring Plan were, respectively, $7 million, $42 million, and ~~nine months ended September 30, 2017.~~$90 million. Total estimated contract termination costs expected to be incurred under the Restructuring Plan associated with Technology rationalizations, Lease consolidations, and Other costs associated with restructuring and separation, respectively, are ~~$10~~$15 million, $80 million, and ~~$10~~$95 million.


(3)	Other costs associated with the Restructuring Plan include those to separate the Divested Business, as well as moving costs, and consulting and legal fees. These costs are generally recognized when incurred.

The changes in the Company’s liabilities for the Restructuring Plan as of ~~September 30, 2017~~March 31, 2019 are as follows (in millions):




Balance as of December 31, 2018	$	201
Expensed	88
Cash payments	(113		)
Foreign currency translation	(1		)
Balance as of March 31, 2019	$	175

Restructuring Plan
Balance as of December 31, 2016 $ —
Expensed 369
Cash payments (199 )
Foreign currency translation and other 17
Balance as of September 30, 2017 $ 187

8. Acquisitions and Dispositions of Businesses

Completed Acquisitions

The Company completed one acquisition during the three months ended March 31, 2019 and eight acquisitions during the twelve months ended December 31, 2018. The following table includes the fair values of consideration transferred, assets acquired, and liabilities assumed as a result of the Company’s acquisitions (in millions):



	Three Months Ended March 31, 2019
Consideration Transferred	$	17
Deferred and contingent consideration	5
Aggregate consideration transferred	$	22

Assets acquired
Cash and cash equivalents	$	2
Goodwill	15
Intangible assets, net	9
Other assets	4
Total assets acquired	30
Liabilities assumed
Current liabilities	6
Other non-current liabilities	2
Total liabilities assumed	8
Net assets acquired	$	22

The results of operations of these acquisitions are included in the Financial Statements as of the respective acquisition dates. The Company’s results of operations would not have been materially different if these acquisitions had been reported from the beginning of the period in which they were acquired.

2019 Acquisitions

On January 1, 2019, the Company completed the transaction to acquire Chapka Assurances SAS based in France.

2018 Acquisitions

On December 31, 2018, the Company completed the transaction to acquire certain assets of Bill Beatty Insurance Agency, Inc. based in the United States.

On November 15, 2018, the Company completed the transaction to acquire certain business and assets of North Harbour Insurance Services (1985) Limited, a New Zealand-based firm.

On October 25, 2018, the Company completed the transaction to acquire 100% capital of GEFASS S.R.L and GE.F.IT S.R.L., Italy-based firms specialized in Bancassurance schemes.

On May 9, 2018, the Company completed the transaction to acquire certain assets of 601West, a division of Lee & Hayes, P.L.L.C. based in the United States.

On April 24, 2018, the Company completed the transaction to acquire Inspiring Benefits, S.L., a Spain-based firm specialized in employee loyalty, wellbeing, and rewards programs.

On March 1, 2018, the Company completed the transaction to acquire the business and assets of the trade credit business of Niche International Business Proprietary Limited, a trade credit brokerage based in Johannesburg, South Africa.

On March 1, 2018, the Company completed the transaction to acquire Affinity Risk Partners (Brokers) Pty. Ltd., an insurance broker in Victoria, Australia.

On January 19, 2018, the Company completed the transaction to acquire substantially all of the assets of The Burchfield Group, a provider in pharmacy benefit consulting, auditing, and health plan compliance services based in the United States.

Completed Dispositions

The Company completed one disposition during the three months ended March 31, 2019. The Company completed no dispositions during the three months ended March 31, 2018.

Total pretax gain, net of losses, for the three months ended March 31, 2019 was $5 million. Total pretax losses recognized for the three months ended March 31, 2018 was $1 million. Gains and losses recognized as a result of a disposition are included in Other income (expense) in the Condensed Consolidated Statements of Income.

9. Goodwill and Other Intangible Assets

The changes in the net carrying amount of goodwill for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2019 are as follows (in millions):



Balance as of December 31, 2018	$	8,171
Goodwill related to current year acquisitions	15
Goodwill related to disposals	(1		)
Goodwill related to prior year acquisitions	1
Foreign currency translation and other	33
Balance as of March 31, 2019	$	8,219

Balance as of December 31, 2016 $ 7,410
Goodwill related to current year acquisitions 121
Goodwill related to disposals (1 )
Goodwill related to prior year acquisitions (6 )
Foreign currency translation 364
Balance as of September 30, 2017 $ 7,888

Other intangible assets by asset class are as follows (in millions):



	March 31, 2019						December 31, 2018
	Gross Carrying Amount		Accumulated Amortization and Impairment		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization and Impairment		Net Carrying Amount
Customer related and contract based	$	2,282	$	1,501	$	781	$	2,240	$	1,444	$	796
Tradenames	1,030		795		235		1,027		740		287
Technology and other	391		330		61		391		325		66
Total	$	3,703	$	2,626	$	1,077	$	3,658	$	2,509	$	1,149

September 30, 2017 December 31, 2016
Gross Carrying Amount
Accumulated
Amortization and Impairment
Net Carrying Amount Gross Carrying Amount Accumulated
Amortization and Impairment Net Carrying Amount
Customer related and contract based $ 2,104
$ 1,380
$ 724
$ 2,023
$ 1,198
$ 825
Tradenames⁽¹⁾
1,041
478
563
1,027
7
1,020
Technology and other⁽¹⁾
384
330
54
347
302
45
Total $ 3,529
$ 2,188
$ 1,341
$ 3,397
$ 1,507
$ 1,890


~~(1)~~	Prior to May 1, 2017, finite lived tradenames were classified within Technology and other. As of December 31, 2016, $29 million of gross carrying amount and $7 million of accumulated amortization related to finite-lived tradenames was reclassified from Technology and other to Tradenames.

In the second quarter of 2017 and in connection with the completion of the sale of the Divested Business, the Company recognized a non-cash impairment charge to the associated tradenames of $380 million. The fair value of the tradenames was determined using the Relief from Royalty Method. This impairment was included in Amortization and impairment of intangible assets on the Condensed Consolidated Statement of Income. Refer to Note 3 “Discontinued Operations” for further information.

Additionally, effective May 1, 2017 and consistent with operating as one segment, the Company implemented a three-year strategy to transition to a unified Aon brand. As a result, Aon commenced amortization of all indefinite lived tradenames and prospectively accelerated amortization of its finite-lived tradenames over the three-year period. The change in estimated useful life resulted in additional amortization expense, net of tax, to continuing operations of $34 million, or $0.13 per share, and $56 million, or $0.21 per share, in the three and nine months ended September 30, 2017, respectively.

Amortization expense and impairment charges from finite lived intangible assets was $101 million and $604 million for the three and nine months ended September 30, 2017, respectively. Amortization expense from finite lived intangible assets was $42 million and $117 million for the three and nine months ended September 30, 2016, respectively.

The estimated future amortization for finite lived intangible assets as of ~~September 30, 2017~~March 31, 2019 is as follows (in millions):



Remainder of 2019	$	311
2020	217
2021	128
2022	85
2023	73
2024	56
Thereafter	207
Total	$	1,077

Remainder of 2017 $ 117
2018 376
2019 357
2020 196
2021 89
Thereafter 206
Total
$ 1,341

9. 10. Debt

Notes

~~During~~On December 3, 2018, Aon Corporation issued $350 million 4.50% Senior Notes due December 2028. The Company used the ~~first quarter~~net proceeds of ~~2017,~~ the offering to pay down a portion of outstanding commercial paper and for general corporate purposes.

On March 8, 2018, the Company’s CAD 375 million ($~~304~~291 million at ~~September 30, 2017~~March 8, 2018 exchange rates) 4.76% Senior ~~Notes~~Note due March 2018 ~~were classified as Short-term debt~~issued by a Canadian subsidiary of Aon Corporation matured and ~~current portion of long-term debt~~was repaid in ~~the Condensed Consolidated Statements of Financial Position as the date of maturity is less than one year.~~full.

Revolving Credit Facilities

As of ~~September 30, 2017,~~March 31, 2019, Aon plc had ~~one~~two primary committed credit ~~facility~~facilities outstanding: its $900 million multi-currency United States (“U.S.”) credit facility expiring in February ~~2021 (the “2021 Facility”). On October 19, 2017, Aon entered into a~~2022 and its $400 million multi-currency U.S. credit facility expiring in October 2022 ~~(the~~(collectively, the “2022 ~~Facility”~~Facilities”). ~~This facility replaced the Company’s previous $400 million U.S. credit facility that expired in March 2017.~~

~~The 2021 Facility~~Each of these facilities includes customary representations, warranties and covenants, including financial covenants that require Aon to maintain specified ratios of adjusted consolidated earnings before interest, taxes, depreciation, and amortization (“EBITDA”) to consolidated interest expense and consolidated debt to adjusted consolidated EBITDA, in each case, tested quarterly. At ~~September 30, 2017,~~March 31, 2019, Aon did not have borrowings under the ~~2021 Facility,~~2022 Facilities, and was in compliance with the financial covenants and all other covenants contained therein during the ~~nine~~rolling twelve months ended ~~September 30, 2017.~~March 31, 2019.

Commercial Paper

Aon Corporation, a ~~wholly-owned~~wholly owned subsidiary of Aon plc, has established a U.S. commercial paper program and Aon plc has established a European multi-currency commercial paper program (collectively, the “CP Programs”). Commercial paper may be issued in an aggregate principal ~~amount~~amounts of up to ~~$1.3 billion~~$600 million under the ~~CP Programs, allocated between~~U.S. program and €525 million under the ~~two programs as determined by management,~~European program, not to exceed the amount of the Company’s committed credit, which was ~~$900 million~~$1.3 billion at ~~September 30, 2017.~~March 31, 2019. The U.S. commercial paper program is fully and unconditionally guaranteed by Aon plc and the European multi-currency commercial paper program is fully and unconditionally guaranteed by Aon Corporation.

Commercial paper outstanding, which is included in Short-term debt and current portion of long-term debt in the Company’s Condensed Consolidated Statements of Financial Position, is as follows (in millions):



As of	March 31, 2019		December 31, 2018
Commercial paper outstanding	$	423	$	250

As of September 30, 2017 December 31, 2016
Commercial paper outstanding $ —
$ 329

The weighted average commercial paper outstanding and its related interest rates are as ~~follows:~~follows (in millions, except percentages):



	Three Months Ended March 31
	2019			2018
Weighted average commercial paper outstanding	$	323		$	125
Weighted average interest rate of commercial paper outstanding	0.49		%	(0.50		)%

Three months ended September 30 Nine months ended September 30
2017 2016 2017 2016
Weighted average commercial paper outstanding $ —
$ 271
$ 227
$ 251
Weighted average interest rate of commercial paper outstanding — % 0.02 % 0.18 % 0.27 %

~~10.~~ 11. Income Taxes

The effective tax rate on net income from continuing operations was ~~2.0% and (49.8)%~~15.7% for the three ~~and nine~~ months ended ~~September 30, 2017, respectively.~~March 31, 2019. The effective tax rate on net income from continuing operations was ~~8.1% and 12.8%~~15.9% for the three ~~and nine~~ months ended ~~September 30, 2016, respectively.~~ March 31, 2018.

For the three months ended ~~September 30, 2017,~~March 31, 2019, the ~~Company reported tax expense of $4 million on pretax income of $200 million, which resulted in an effective~~ tax rate ~~of 2.0%,~~was primarily driven by the ~~jurisdictional~~geographical distribution of income ~~including~~and certain discrete items, primarily the ~~estimated~~favorable impact of ~~the Restructuring Program and the accelerated amortization of tradenames.~~shared-based payments. For the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2018, the ~~Company reported a tax benefit of $139 million on pretax income of $279 million, which resulted in an effective~~ tax rate was primarily driven by the geographical distribution of ~~(49.8)%. The primary components of the year to date tax amounts were the non-cash tax benefit from the tradename impairment associated with the Divested Business~~income and certain discrete items including the impact of share-based payments ~~from adoption~~and a decrease in uncertain tax positions related to the statute of ~~the new share-based compensation guidance. Refer to Note 2 “Accounting Principles and Practices” for additional details.~~limitations expiration following an audit.

~~11.~~ 12. Shareholders’ Equity

Ordinary Shares

Aon has a share repurchase program authorized by the Company’s Board of Directors (the “Repurchase Program”). The Repurchase Program was established in April 2012 with ~~up to~~ $5.0 billion in authorized repurchases, and was increased by $5.0 billion in authorized repurchases in each of November 2014 and February 2017 for a total of $15.0 billion in repurchase authorizations.

Under the Repurchase Program, Class A Ordinary Shares may be repurchased through the open market or in privately negotiated transactions, from time to time, based on prevailing market conditions, and will be funded from available capital.

The following table summarizes the ~~three months ended September 30, 2017, the Company repurchased 5.4 million shares at an average price~~Company’s Share Repurchase activity (in millions, except per share of $139.61, for a total cost of approximately $749 million and recorded an additional $3.8 million of costs associated with the repurchases to retained earnings. During the nine months ended September 30, 2017, the Company repurchased 14.5 million shares at an average price per share of $131.58, for a total cost of approximately $1.9 billion and recorded an additional $9.5 million of costs associated with the repurchases to retained earnings. Included in the 5.4 million shares and 14.5 million shares repurchased during the three and nine months ended September 30, 2017 were 165 thousand shares that did not settle until October 2017. These shares were settled at an average price per share of $146.52 and total cost of $24.2 million. In the three months endeddata):



	Three Months Ended March 31
	2019		2018
Shares repurchased	0.6		3.9
Average price per share	$	161.16	$	140.94
Costs recorded to retained earnings:
Total repurchase cost	$	100	$	550
Additional associated costs	1		3
Total costs recorded to retained earnings	$	101	$	553

September 30, 2016, the Company repurchased 2.7 million shares at an average price per share of $110.26 for a total cost of approximately $301 million. During the nine months ended September 30, 2016, the Company repurchased 10.4 million shares at an average price per share of $101.16, for a total cost of approximately $1.1 billion. At ~~September 30, 2017,~~March 31, 2019, the remaining authorized amount for share repurchase under the Repurchase Program was ~~$5.9~~$3.9 billion. Under the Repurchase Program, the Company has repurchased a total of ~~104.7~~118.9 million shares for an aggregate cost of approximately ~~$9.1~~$11.1 billion.

Net Income Per Share

Weighted average ordinary shares outstanding are as follows (in millions):



	Three Months Ended March 31
	2019	2018
Basic weighted average ordinary shares outstanding	242.2	248.5
Dilutive effect of potentially issuable shares	1.5	1.7
Diluted weighted average ordinary shares outstanding	243.7	250.2

Three months ended September 30 Nine months ended September 30
2017 2016 2017 2016
Basic weighted-average ordinary shares outstanding 255.6
267.5
260.9
269.1
Dilutive effect of potentially issuable shares 1.7
2.1
2.0
1.9
Diluted weighted-average ordinary shares outstanding 257.3
269.6
262.9
271.0

Potentially issuable shares are not included in the computation of diluted net income per share if ~~their~~its inclusion would be antidilutive. There were no0.1 million shares excluded from the calculation for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2019 and ~~2016.~~March 31, 2018.

Accumulated Other Comprehensive Loss

Changes in Accumulated other comprehensive loss by component, net of related tax, are as follows (in millions):

Change in Fair Value of Financial Instruments ⁽¹⁾
Foreign Currency Translation Adjustments
Post-Retirement Benefit Obligation ⁽²⁾
Total
Balance at December 31, 2016 $ (37 ) $ (1,264 ) $ (2,611 ) $ (3,912 )
Other comprehensive income (loss) before reclassifications, net 13
442
—
455
Amounts reclassified from accumulated other comprehensive loss:

Amounts reclassified from accumulated other comprehensive income (loss) (2 ) (11 ) 80
67
Tax benefit (expense) 2
—
(24 ) (22 )
Amounts reclassified from accumulated other comprehensive income (loss), net —
(11 ) 56
45
Net current period other comprehensive income (loss) 13
431
56
500
Balance at September 30, 2017 $ (24 ) $ (833 ) $ (2,555 ) $ (3,412 )



	Change in Fair Value of Financial Instruments ⁽¹⁾			Foreign Currency Translation Adjustments			Postretirement Benefit Obligation ⁽²⁾			Total
Balance at December 31, 2018	$	(15	)	$	(1,319	)	$	(2,575	)	$	(3,909	)
Other comprehensive income before reclassifications, net	4			131			11			146
Amounts reclassified from accumulated other comprehensive income
Amounts reclassified from accumulated other comprehensive income	5			—			26			31
Tax expense	(2		)	—			(6		)	(8		)
Amounts reclassified from accumulated other comprehensive income, net	3			—			20			23
Net current period other comprehensive income	7			131			31			169
Balance at March 31, 2019	$	(8	)	$	(1,188	)	$	(2,544	)	$	(3,740	)


(1)	Reclassifications from this category included in Accumulated other comprehensive loss are recorded in ~~Other income (expense), Other general expenses,~~Revenue, Interest expense, and Compensation and benefits. ~~See~~Refer to Note 1415 “Derivatives and Hedging” for ~~additional~~further information regarding the Company’s derivative and hedging activity.


(2)	Reclassifications from this category included in Accumulated other comprehensive loss are recorded in ~~Compensation and benefits.~~Other income (expense).

~~12.~~

13. Employee Benefits

The following table provides the components of the net periodic (benefit) cost ~~(benefit)~~ recognized in the Condensed Consolidated Statements of Income ~~in Compensation and benefits~~ for Aon’s material U.K., U.S., and other significant international pension plans located in the Netherlands and ~~Canada~~Canada. Service cost is reported in Compensation and benefits and all other components are reported in Other income (expense) as follows (in millions):



	Three Months Ended March 31
	U.K.						U.S.						Other
	2019			2018			2019			2018			2019			2018
Interest cost	$	28		$	29		$	27		$	25		$	7		$	7
Expected return on plan assets, net of administration expenses	(49		)	(51		)	(34		)	(36		)	(10		)	(12		)
Amortization of prior-service cost	1			—			1			—			—			—
Amortization of net actuarial loss	7			8			13			15			3			3
Net periodic (benefit) cost	(13		)	(14		)	7			4			—			(2		)
Loss on pension settlement	—			7			—			—			—			—
Total net periodic (benefit) cost	$	(13	)	$	(7	)	$	7		$	4		$	—		$	(2	)

Three months ended September 30
U.K. U.S. Other
2017 2016 2017 2016 2017 2016
Service cost $ —
$ —
$ —
$ —
$ —
$ —
Interest cost 31
37
24
28
7
7
Expected return on plan assets, net of administration expenses (50 ) (58 ) (34 ) (39 ) (13 ) (12 )
Amortization of prior-service cost —
—
—
1
—
—
Amortization of net actuarial loss 8
7
13
12
3
3
Net periodic cost (benefit) $ (11 ) $ (14 ) $ 3
$ 2
$ (3 ) $ (2 )
Loss on pension settlement —
—
—
—
—
—
Total net periodic cost (benefit) $ (11 )
$ (14 )
$ 3

$ 2

$ (3 )
$ (2 )

Nine months ended September 30
U.K. U.S. Other
2017 2016 2017 2016 2017 2016
Service cost $ —
$ —
$ —
$ —
$ —
$ —
Interest cost 91
123
72
83
19
21
Expected return on plan assets, net of administration expenses (147 ) (187 ) (104 ) (117 ) (35 ) (36 )
Amortization of prior-service cost —
1
1
2
—
—
Amortization of net actuarial loss 23
24
38
37
9
8
Net periodic cost (benefit) $ (33 ) $ (39 ) $ 7
$ 5
$ (7 ) $ (7 )
Loss on pension settlement —
61
—
—
—
—
Total net periodic cost (benefit) $ (33 ) $ 22
$ 7
$ 5
$ (7 ) $ (7 )

In March 2017, the Company approved a plan to offer a voluntary one-time lump sum payment option to certain eligible employees of the Company’s U.K. pension plans that, if accepted, would settle the Company’s pension ~~obligation~~obligations to them. AThe lump sum cash payment offer closed during 2018. For the three months ended March 31, 2018, lump sum payments from plan assets of £48 million ($68 million using March 31, 2018 exchange rates) were paid. As a result of this settlement, the Company remeasured the assets and liabilities of the U.K. pension plan during the first quarter of 2018, which in aggregate resulted in a reduction to the projected benefit obligation of £44 million ($63 million using March 31, 2018 exchange rates), as well as a non-cash settlement charge ~~is expected~~of £5 million ($7 million using average March 31, 2018 exchange rates) in the ~~fourth~~first quarter of ~~2017.~~2018.

Contributions

The Company expects to make cash contributions of approximately $80 million, ~~$51~~$46 million, and ~~$18~~$19 million, based on exchange rates as of December 31, ~~2016,~~2018, to its significant U.K., U.S., and other significant international pension plans, respectively, during ~~2017.~~2019. During the three months ended ~~September 30, 2017,~~March 31, 2019, cash contributions of ~~$22~~$23 million, $5$17 million, and $3$7 million were made to the Company’s significant U.K., U.S., and other significant international pension plans, respectively.

During the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2018, cash contributions of ~~$64~~$23 million, ~~$31~~$17 million, and ~~$14~~$8 million were made to the Company’s significant U.K., U.S., and other significant international pension plans, respectively. ~~During the three and nine months ended September 30, 2017, Aon made a non-cash contribution of approximately $80 million to its U.S. pension plan.~~

During the three months ended September 30, 2016, cash contributions of $19 million, $5 million, and $4 million were made to the Company’s significant U.K., U.S., and other significant international pension plans, respectively. During the nine months ended September 30, 2016, cash contributions of $53 million, $24 million, and $14 million were made to the Company’s significant U.K., U.S., and other significant international pension plans, respectively.

~~13.~~ 14. Share-Based Compensation Plans

The following table summarizes share-based compensation expense recognized in the Condensed Consolidated Statements of Income in Compensation and benefits (in millions):



	Three Months Ended March 31
	2019		2018
Restricted share units (“RSUs”)	$	63	$	58
Performance share awards (“PSAs”)	23		16
Employee share purchase plans	3		3
Total share-based compensation expense	$	89	$	77

Three months ended September 30 Nine months ended September 30
2017 2016 2017 2016
Restricted share units (“RSUs”) $ 42
$ 40
$ 143
$ 136
Performance share awards (“PSAs”) 22
24
63
67
Employee share purchase plans 3
2
8
7
Total share-based compensation expense
$ 67
$ 66
$ 214
$ 210

Restricted Share Units

RSUs generally vest between three and five years. The fair value of RSUs is based upon the market value of Aon plc ordinary shares at the date of grant. With certain limited exceptions, any break in continuous employment will cause the forfeiture of all non-vested awards. Compensation expense associated with RSUs is recognized on a straight-line basis over the requisite service period. Dividend equivalents are paid on certain RSUs, based on the initial grant amount.

The following table summarizes the status of the Company’s RSUs, including shares related to the Divested Business (shares in ~~thousands)~~thousands, except fair value):



	2019				2018
	Shares		Fair Value ⁽¹⁾		Shares		Fair Value ⁽¹⁾
Non-vested at beginning of period	4,208		$	120	4,849		$	104
Granted	517		$	170	505		$	144
Vested	(677	)	$	117	(806	)	$	101
Forfeited	(41	)	$	121	(63	)	$	105
Non-vested at end of period	4,007		$	127	4,485		$	109

2017 2016
Shares
Fair Value ⁽¹⁾
Shares
Fair Value ⁽¹⁾
Non-vested at December 31 6,195
$ 89
7,167
$ 77
Granted 1,549
122
2,110
101
Vested (2,294 ) 82
(2,729 ) 70
Forfeited (590 ) 92
(333 ) 81
Non-vested at September 30 4,860
$ 102
6,215
$ 88


(1)	Represents per share weighted average fair value of award at date of grant.

Unamortized deferred compensation expense amounted to ~~$367~~$366 million as of ~~September 30, 2017,~~March 31, 2019, with a remaining ~~weighted-average~~weighted average amortization period of approximately ~~2.1~~2 years.

Performance Share Awards

The vesting of PSAs is contingent upon meeting a cumulative level of earnings per share related performance over a three-year period. The actual issue of shares may range from 0-200% of the target number of PSAs granted, based on the terms of the plan and level of achievement of the related performance target. The grant date fair value of PSAs is based upon the market price of Aon plc ordinary shares at the date of grant. The performance conditions are not considered in the determination of the grant date fair value for these awards. Compensation expense is recognized over the performance period based on management’s estimate of the number of units expected to vest. Management evaluates its estimate of the actual number of shares expected to be issued at the end of the programs on a quarterly basis. The cumulative effect of the change in estimate is recognized in the period of change as an adjustment to Compensation and benefits ~~expense,~~in the Condensed Consolidated Statements of Income, if necessary. Dividend equivalents are not paid on PSAs.

~~Information as of September 30, 2017 regarding~~The following table summarizes the Company’s target PSAs granted and shares that would be issued at current performance levels for PSAs granted during the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2019 and the years ended December 31, ~~2016~~2018 and ~~2015,~~2017, respectively ~~is as follows~~ (shares in thousands and dollars in millions, except fair value):



	March 31, 2019		December 31, 2018		December 31, 2017
Target PSAs granted during period	467		564		548
Weighted average fair value per share at date of grant	$	165	$	134	$	114
Number of shares that would be issued based on current performance levels	467		838		1,067
Unamortized expense, based on current performance levels	$	77	$	70	$	32

September 30,
2017 December 31,
2016 December 31,
2015
Target PSAs granted during period 548
752
967
Weighted average fair value per share at date of grant $ 114
$ 100
$ 96
Number of shares that would be issued based on current performance levels 544
663
1,362
Unamortized expense, based on current performance levels $ 51
$ 27
$ 11

~~14.~~ 15. Derivatives and Hedging

The Company is exposed to market risks, including changes in foreign currency exchange rates and interest rates. To manage the risk related to these exposures, the Company enters into various derivative instruments that reduce these risks by creating offsetting exposures. The Company does not enter into derivative transactions for trading or speculative purposes.

Foreign Exchange Risk Management

The Company is exposed to foreign exchange risk when it earns revenues, pays expenses, enters into monetary intercompany transfers or other transactions denominated in a currency that differs from ~~its functional currency, or enters into other transactions that are denominated in a currency other than~~ its functional currency. The Company uses foreign exchange derivatives, typically forward contracts, options and cross currency swaps, to reduce its overall exposure to the effects of currency fluctuations on cash flows. These exposures are hedged, on average, for less than ~~two~~2 years. These derivatives are accounted for as hedges, and changes in fair value are recorded each period in Other comprehensive income (loss) in the Condensed Consolidated Statements of Comprehensive Income.

The Company also uses foreign exchange derivatives, typically forward contracts and options, to economically hedge the currency exposure of the Company’s global liquidity profile, including monetary assets or liabilities that are denominated in a non-functional currency of an entity, typically on a rolling 30-day basis, but may be for up to ~~one~~1 year in the future. These derivatives are not accounted for as hedges, and changes in fair value are recorded each period in Other income (expense) in the Condensed Consolidated Statements of Income.

The notional and fair values of derivative instruments are as follows (in millions):


	Notional Amount				Derivative Assets ⁽¹⁾				Derivative Liabilities ⁽²⁾				Notional Amount				Net Amount of Derivative Assets Presented in the Statements of Financial Position ⁽¹⁾				Net Amount of Derivative Liabilities Presented in the Statements of Financial Position ⁽²⁾
	September 30, 2017		December 31, 2016		September 30, 2017		December 31, 2016		September 30, 2017		December 31, 2016		March 31, 2019		December 31, 2018		March 31, 2019		December 31, 2018		March 31, 2019		December 31, 2018
Foreign exchange contracts
Accounted for as hedges	$	711	$	758	$	31	$	14	$	3	$	13	$	565	$	646	$	20	$	17	$	1	$	2
Not accounted for as hedges ⁽³⁾	245		189		—		1		2		1		321		269		—		1		—		6
Total	$	956	$	947	$	31	$	15	$	5	$	14	$	886	$	915	$	20	$	18	$	1	$	8


(1)	Included within Other current assets ($6 million at ~~September 30, 2017~~March 31, 2019 and $6$3 million at December 31, ~~2016)~~2018) or Other non-current assets ($2514 million at ~~September 30, 2017~~March 31, 2019 and $9$15 million at December 31, ~~2016)~~2018).


(2)	Included within Other current liabilities ($31 million at ~~September 30, 2017~~March 31, 2019 and $7$5 million at December 31, ~~2016)~~2018) or Other non-current liabilities ($~~2 million at September 30, 2017 and $7~~3 million at December 31, ~~2016)~~2018).


(3)	These contracts typically are for 30 day durations and ~~are~~ executed close to the last day of the most recent reporting month, thereby resulting in nominal fair values at the balance sheet date.

~~Offsetting of derivatives assets are as follows (in millions):~~

Gross Amounts of Recognized Assets Gross Amounts Offset in the Statement of Financial Position
Net Amounts of Assets Presented in the Statement of Financial Position ⁽¹⁾
Derivatives accounted for as hedges September 30,
2017 December 31,
2016 September 30,
2017 December 31,
2016 September 30,
2017 December 31,
2016
Foreign exchange contracts $ 31
$ 14
$ —
$ (1 ) $ 31
$ 13


~~(1)~~	Included within Other current assets ($6 million at September 30, 2017 and $4 million at December 31, 2016) or Other non-current assets ($25 million at September 30, 2017 and $9 million at December 31, 2016).

~~Offsetting of derivative liabilities are as follows (in millions):~~

Gross Amounts of Recognized Liabilities Gross Amounts Offset in the Statement of Financial Position
Net Amounts of Liabilities Presented in the Statement of Financial Position ⁽¹⁾
Derivatives accounted for as hedges September 30,
2017 December 31,
2016 September 30,
2017 December 31,
2016 September 30,
2017 December 31,
2016
Foreign exchange contracts $ 3
$ 13
$ —
$ (1 ) $ 3
$ 12


~~(1)~~	Included within Other current liabilities ($2 million at September 30, 2017 and $5 million at December 31, 2016) or Other non-current liabilities ($1 million at September 30, 2017 and $7 million at December 31, 2016).

The amounts of derivative gains (losses) recognized in the ~~Condensed Consolidated~~ Financial Statements ~~for the three and nine months ended September 30, 2017 and 2016~~ are as follows (in millions):

Cash Flow Hedge - Foreign Exchange Contracts Location of Eventual Reclassification from Accumulated Other Comprehensive Loss Gain (Loss) Currently Recognized in Accumulated Other Comprehensive Loss
Three months ended September 30 Compensation and Benefits Other General Expenses Interest Expense Other Income (Expense) Total
2017 $ —
$ 3
$ —
$ 8
$ 11
2016 10
(4 ) —
(7 ) (1 )

Cash Flow Hedge - Foreign Exchange Contracts Location of Eventual Reclassification from Accumulated Other Comprehensive Loss Gain (Loss) Currently Recognized in Accumulated Other Comprehensive Loss
Nine months ended September 30 Compensation and Benefits Other General Expenses Interest Expense Other Income (Expense) Total
2017 $ 9
$ 5
$ —
$ 4
$ 18
2016 8
(9 ) —
(18 ) (19 )



	Three Months Ended
	March 31, 2019		March 31, 2018
Gain (Loss) recognized in Accumulated other comprehensive loss	$	4	$	14

The amounts of derivative gains (losses) reclassified from Accumulated other comprehensive loss into the Condensed Consolidated Statements of Income are as follows (in millions):



	Three Months Ended
	March 31, 2019			March 31, 2018
Compensation and benefits	$	—		$	1
Other general expenses	—			(1		)
Interest expense	(1		)	(1		)
Revenue ⁽¹⁾	(4		)	—
Other income (expense) ⁽¹⁾	—			(3		)
Total	$	(5	)	$	(4	)

Cash Flow Hedge - Foreign Exchange Contracts Gain (Loss) reclassified from Accumulated Other Comprehensive Loss into Income (Effective Portion)
Three months ended September 30 Compensation and Benefits Other General Expenses Interest Expense Other Income (Expense) Total
2017 $ 1
$ (1 ) $ —
$ (3 ) $ (3 )
2016 1
(1 ) —
(2 ) (2 )

Cash Flow Hedge - Foreign Exchange Contracts Gain (Loss) reclassified from Accumulated Other Comprehensive Loss into Income (Effective Portion)
Nine months ended September 30 Compensation and Benefits Other General Expenses Interest Expense Other Income (Expense) Total
2017 $ 14
$ (3 ) $ (1 ) $ (7 ) $ 3
2016 2
(2 ) (1 ) (5 ) (6 )


(1)	With the adoption of new derivative guidance in 2019, gains (losses) on derivatives accounted for as hedges are recognized in Total revenue in the Company’s Condensed Consolidated Statements of Income rather than Other income (expense). Refer to Note 2 “Accounting Principles and Practices” for additional details.

The Company estimates that approximately ~~$11~~$10 million of pretax losses currently included within Accumulated other comprehensive loss will be reclassified in to earnings in the next twelve months.

~~The amount of gain (loss) recognized in income on the ineffective portion of derivatives for the three and nine months ended September 30, 2017 and 2016 was immaterial.~~

During the three ~~and nine~~ months ended ~~September 30, 2017,~~March 31, 2019, the Company recorded a gain of $8$5 million ~~and $9 million, respectively,~~ in Other income (expense) for foreign exchange derivatives not ~~designated or qualifying~~accounted for as hedges. During the three ~~and nine~~ months ended ~~September 30, 2016,~~March 31, 2018, the Company recorded a gain of $2$9 million ~~and $1 million, respectively,~~ in Other income (expense) for foreign exchange derivatives not ~~designated or qualifying~~accounted for as hedges.

Net Investments in Foreign Operations Risk Management

The Company uses non-derivative financial instruments to protect the value of its investments in a number of foreign subsidiaries. ~~In 2016, the~~The Company has designated a portion of its ~~Euro-denominated~~euro-denominated commercial paper issuances as a non-derivative hedge of the foreign currency exposure of a net investment in its European operations. The change in fair value of the designated portion of

the ~~Euro-denominated~~euro-denominated commercial paper due to changes in foreign currency exchange rates is recorded in Foreign currency translation adjustment, a component of Accumulated other comprehensive ~~income (loss),~~loss, to the extent it is effective as a hedge. The foreign currency translation adjustment of the hedged net investments ~~that~~ is also recorded in Accumulated other comprehensive ~~income (loss).~~loss. Ineffective portions of net investment hedges, if any, are reclassified from Accumulated other comprehensive ~~income (loss)~~loss into earnings during the period of change.

As of ~~September 30, 2017,~~March 31, 2019, the Company ~~had no~~has €220 million ($248 million at March 31, 2019 exchange rates) of outstanding ~~Euro-denominated~~euro-denominated commercial paper designated as a hedge of the foreign currency exposure of its net investment in its European operations. As of ~~September 30, 2017,~~March 31, 2019, the unrealized gain recognized in Accumulated other comprehensive ~~income (loss)~~loss related to the net investment non derivative hedging instrument was ~~immaterial.~~$23 million.

The Company did not reclassify any deferred gains or losses related to net investment hedges from Accumulated other comprehensive ~~income (loss)~~loss to earnings during the three ~~and nine~~ months ended ~~September 30, 2017. In addition, the Company did not incur any ineffectiveness related to net investment hedges during the three~~March 31, 2019 and ~~nine months ended September 30, 2017.~~2018.

~~15.~~ 16. Fair Value Measurements and Financial Instruments

Accounting standards establish a three tier fair value hierarchy that prioritizes the inputs used in measuring fair values as follows:

Level 1 — observable inputs such as quoted prices for identical assets in active markets;

Level 2 — inputs other than quoted prices for identical assets in active markets, that are observable either directly or indirectly; and

Level 3 — unobservable inputs in which there is little or no market data which requires the use of valuation techniques and the development of assumptions.

The following methods and assumptions are used to estimate the fair values of the Company’s financial instruments:

Money market funds consist of institutional prime, treasury, and government money market funds. The Company reviews treasury and government money market funds to obtain reasonable assurance that the fund net asset value is $1 per share, and reviews the floating net asset value of institutional prime money market funds for reasonableness.

Equity investments consist of domestic and international equity securities and equity derivatives valued using the closing stock price on a national securities exchange. Over the counter equity derivatives are valued using observable inputs such as underlying prices of the underlying security and volatility. On a sample basis the Company reviews the listing of Level 1 equity securities in the portfolio and agrees the closing stock prices to a national securities exchange, and independently verifies the observable inputs for Level 2 equity derivatives and securities.

Fixed income investments consist of certain categories of bonds and derivatives. Corporate, government, and agency bonds are valued by pricing vendors who estimate fair value using recently executed transactions and proprietary models based on observable inputs, such as interest rate spreads, yield curves, and credit risk. Asset-backed securities are valued by pricing vendors who estimate fair value using discounted cash flow models utilizing observable inputs based on trade and quote activity of securities with similar features. Fixed income derivatives are valued by pricing vendors using observable inputs such as interest rates and yield curves. The Company obtains an understanding of the models, inputs, and assumptions used in developing prices provided by its vendors through discussions with the fund managers. The Company independently verifies the observable inputs, as well as assesses assumptions used for reasonableness based on relevant market conditions and internal Company guidelines. If an assumption is deemed unreasonable, based on the Company’s guidelines, it is then reviewed by management and the fair value estimate provided by the vendor is adjusted, if deemed appropriate. These adjustments do not occur frequently and historically are not material to the fair value estimates used in the ~~Consolidated~~ Financial Statements.

Derivatives are carried at fair value, based upon industry standard valuation techniques that use, where possible, current market-based or independently sourced pricing inputs, such as interest rates, currency exchange rates, or implied volatilities.

Debt is carried at outstanding principal balance, less any unamortized issuance costs, discount or premium. Fair value is based on quoted market prices or estimates using discounted cash flow analyses based on current borrowing rates for similar types of borrowing arrangements.

The following tables present the categorization of the Company’s assets and liabilities that are measured at fair value on a recurring basis at ~~September 30, 2017~~March 31, 2019 and December 31, ~~2016~~2018 (in millions):

Fair Value Measurements Using
Balance at September 30, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)
Assets:

Money market funds ⁽¹⁾
$ 3,091
$ 3,091
$ —
$ —
Other investments:

Government bonds 1
—
1
—
Equity investments 11
7
4
—
Derivatives: ⁽²⁾

Foreign exchange contracts 31
—
31
—
Liabilities:

Derivatives: ⁽²⁾

Foreign exchange contracts 5
—
5
—



			Fair Value Measurements Using
	Balance at March 31, 2019		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money market funds ⁽¹⁾	$	1,979	$	1,979	$	—	$	—
Other investments
Government bonds	$	1	$	—	$	1	$	—
Equity investments	$	2	$	—	$	2	$	—
Derivatives ⁽²⁾
Gross foreign exchange contracts	$	25	$	—	$	25	$	—
Liabilities
Derivatives ⁽²⁾
Gross foreign exchange contracts	$	6	$	—	$	6	$	—


(1)	Included within Fiduciary assets or Short-term investments ~~or Cash and cash equivalents~~ in the Condensed Consolidated Statements of Financial Position, depending on their nature and initial maturity.


(2)	Refer to Note 1415 “Derivatives and Hedging” for additional information regarding the Company’s derivatives and hedging activity.

Fair Value Measurements Using
Balance at December 31, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)
Assets:

Money market funds ⁽¹⁾
$ 1,371
$ 1,371
$ —
$ —
Other investments:

Government bonds 1
—
1
—
Equity investments 9
6
3
—
Derivatives: ⁽²⁾

Foreign exchange contracts 15
—
15
—
Liabilities:

Derivatives: ⁽²⁾

Foreign exchange contracts 14
—
14
—



			Fair Value Measurements Using
	Balance at December 31, 2018		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money market funds ⁽¹⁾	$	1,759	$	1,759	$	—	$	—
Other investments
Government bonds	$	1	$	—	$	1	$	—
Equity investments	$	2	$	—	$	2	$	—
Derivatives ⁽²⁾
Gross foreign exchange contracts	$	21	$	—	$	21	$	—
Liabilities
Derivatives ⁽²⁾
Gross foreign exchange contracts	$	12	$	—	$	12	$	—


(1)	Included within Fiduciary assets or Short-term investments ~~or Cash and cash equivalents~~ in the Condensed Consolidated Statements of Financial Position, depending on their nature and initial maturity.


(2)	Refer to Note 1415 “Derivatives and Hedging” for additional information regarding the Company’s derivatives and hedging activity.

There were no transfers of assets or liabilities between fair value hierarchy levels in either the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2019 or ~~2016.~~2018. The Company recognized no realized or unrealized gains or losses in the Condensed Consolidated Statements of Income during either the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2019 or ~~2016,~~2018, related to assets and liabilities measured at fair value using unobservable inputs.

The fair value of debt is classified as Level 2 of the fair value hierarchy. The following table ~~discloses~~provides the carrying value and fair value for the Company’s ~~financial instruments where the carrying amounts and fair values differ~~term debt (in millions):



	March 31, 2019				December 31, 2018
	Carrying Value		Fair Value		Carrying Value		Fair Value
Long-term debt	$	5,990	$	6,344	$	5,993	$	6,159

September 30, 2017 December 31, 2016
Carrying Value Fair Value Carrying Value Fair Value
Current portion of long-term debt ⁽¹⁾
$ 305
$ 309
$ —
$ —
Long-term debt 5,662
6,227
5,869
6,264


~~(1)~~	~~Excludes commercial paper program.~~

~~16.~~ ~~Commitments~~

17. Claims, Lawsuits, and Other Contingencies

Legal

Aon and its subsidiaries are subject to numerous claims, tax assessments, lawsuits and proceedings that arise in the ordinary course of business, which frequently include errors and omissions (“E&O”) claims. The damages claimed in these matters are or may be substantial, including, in many instances, claims for punitive, treble or extraordinary damages. While Aon maintains meaningful E&O insurance and other insurance programs to provide protection against certain losses that arise in such matters, Aon has exhausted or materially depleted its coverage under some of the policies that protect the Company and, consequently, is self-insured or materially self-insured for some claims. Accruals for these exposures, and related insurance receivables, when applicable, are included in the Condensed Consolidated Statements of Financial Position and have been recognized in Other general expenses in the Condensed Consolidated Statements of Income to the extent that losses are deemed probable and are reasonably estimable. These amounts are adjusted from time to time as developments warrant. Matters that are not probable and reasonably estimable are not accrued for in the financial statements.

The Company has included in the current matters described below certain matters in which (1) loss is probable, (2) loss is reasonably possible, that is, more than remote but not probable, or (3) there exists the reasonable possibility of loss greater than the accrued amount. In addition, the Company may from time to time disclose matters for which the probability of loss could be remote but the claim amounts associated with such matters are potentially significant. The reasonably possible range of loss for the matters described below for which loss is estimable, in excess of amounts that are deemed probable and estimable and therefore already accrued, is estimated to be between $0 and ~~$0.3~~$0.1 billion, exclusive of any insurance coverage. These estimates are based on ~~currently~~ available ~~information.~~information as of the date of this filing. As available information changes, the matters for which Aon is able to estimate may change, and the estimates themselves may change. In addition, many estimates involve significant judgment and uncertainty. For example, at the time of making an estimate, Aon may only have limited information about the facts underlying the claim, and predictions and assumptions about future court rulings and outcomes may prove to be inaccurate. Although management at present believes that the ultimate outcome of all matters described below, individually or in the aggregate, will not have a material adverse effect on the consolidated financial position of Aon, legal proceedings are subject to inherent uncertainties and unfavorable rulings or other events. Unfavorable resolutions could include substantial monetary or punitive damages imposed on Aon or its subsidiaries. If unfavorable outcomes of these matters were to occur, future results of operations or cash flows for any particular quarterly or annual period could be materially adversely affected.

Current Matters

A retail insurance brokerage subsidiary of Aon was sued on September 14, 2010 in the Chancery Court for Davidson County, Tennessee Twentieth Judicial District, at Nashville by a client, Opry Mills Mall Limited Partnership (“Opry Mills”) that sustained flood damage to its property in May 2010. The lawsuit seeks $200 million in coverage from numerous insurers with whom this Aon subsidiary placed the client’s property insurance coverage. The insurers contend that only $50 million in coverage (which has already been paid) is available for the loss because the flood event occurred on property in a high hazard flood zone. Opry Mills is seeking full coverage from the insurers for the loss and has sued this Aon subsidiary in the alternative for the same $150 million difference on various theories of professional liability if the court determines there is not full coverage. In addition, Opry Mills seeks prejudgment interest, attorneys’ fees and enhanced damages which could substantially increase Aon’s exposure. In March 2015, the trial court granted partial summary judgment in favor of plaintiffs and against the insurers, holding generally that the plaintiffs are entitled to $200 million in coverage under the language of the policies. In August 2015, a jury returned a verdict in favor of Opry Mills and against the insurers in the amount of $204 million. The insurers have appealed both of these trial court decisions. Aon believes it has meritorious defenses and intends to vigorously defend itself against these claims.

A pensions consulting and administration subsidiary of Aon provided advisory services to the Trustees of the Gleeds pension fund in the United Kingdom and, on occasion, to the relevant employer of the fund. In April 2014, the High Court, Chancery Division, London found that certain governing documents of the fund that sought to alter the fund’s benefit structure and that had been drafted by Aon were procedurally defective and therefore invalid. No lawsuit naming Aon as a party was filed, although a tolling

agreement was entered. The High Court decision says that the additional liabilities in the pension fund resulting from the alleged defect in governing documents amount to approximately £45 million ($6159 million at ~~September 30, 2017~~March 31, 2019 exchange rates). In December 2014, the Court of Appeal granted the employer leave to appeal the High Court decision. At a hearing in October 2016, the Court of Appeal approved a settlement of the pending litigation. On October 31, 2016, the fund’s trustees and employer sued Aon in the High Court, Chancery Division, London, alleging negligence and breach of duty in relation to the governing documents. The proceedings were served on Aon on December 20, 2016. The claimants seek damages of approximately £70 million ($9492 million at ~~September 30, 2017~~March 31, 2019 exchange rates). In February 2018, the claimants instructed new lawyers and added their previous lawyers as defendants to the Aon lawsuit. Claimants have alleged that the previous lawyers were responsible for some of the losses sought from Aon because the lawyers gave negligent legal advice during the course of the High Court and Court of Appeal proceedings. Aon believes that it has meritorious defenses and intends to vigorously defend itself against this claim.

On June 29, 2015, Lyttelton Port Company Limited (“LPC”) sued Aon New Zealand in the Christchurch Registry of the High Court of New Zealand. LPC alleges, among other things, that Aon was negligent and in breach of contract in arranging LPC’s property insurance program for the period covering June 30, 2010 to June 30, 2011. LPC contends that acts and omissions by Aon caused LPC to recover less than it otherwise would have from insurers for losses suffered in the 2010 and 2011 Canterbury earthquakes. LPC claims damages of approximately NZD 184 million ($~~133~~127 million at ~~September 30, 2017~~March 31, 2019 exchange rates) plus interest and costs. ~~Aon believes that it has meritorious defenses and intends to vigorously defend itself against these claims.~~In April 2019, the case was settled with no admission of liability on the part of Aon. The terms of this settlement did not have a significant impact on Aon’s results of operations or financial condition.

On October 3, 2017, Christchurch City Council (“CCC”) invoked arbitration to pursue a claim that it asserts against Aon New Zealand. Aon provided insurance broking services to CCC in relation to CCC’s 2010-2011 material damage and business interruption program. In December 2015, CCC settled its property and business interruption claim for its losses arising from the 2010-2011 Canterbury earthquakes against the underwriter of its material damage and business interruption program and the reinsurers of that underwriter. CCC contends that acts and omissions by Aon caused CCC to recover less in that settlement than

it otherwise would have. CCC claims damages of approximately NZD 528 million ($~~381~~365 million at ~~September 30, 2017~~March 31, 2019 exchange rates) plus interest and costs. Aon believes that it has meritorious defenses and intends to vigorously defend itself against these claims.

A retail insurance brokerage subsidiary of Aon was sued on September 6, 2018 in the United States District Court for the Southern District of New York by a client, Pilkington North America, Inc., that sustained damage from a tornado to its Ottawa, Illinois property. The lawsuit seeks between $45 million and $85 million in property and business interruption damages from either its insurer or Aon. The insurer contends that insurance proceeds were limited to $15 million in coverage by a windstorm sub-limit purportedly contained in the policy procured by Aon for Pilkington. The insurer therefore has tendered $15 million to Pilkington and denied coverage for the remainder of the loss. Pilkington sued the insurer and Aon seeking full coverage for the loss from the insurer or, in the alternative, seeking the same damages against Aon on various theories of professional liability if the court finds that the $15 million sub-limit applies to the claim. Aon believes it has meritorious defenses and intends to vigorously defend itself against these claims.

In April 2017, the ~~Financial Conduct Authority (the “FCA”)~~FCA announced an investigation relating to suspected competition law breaches in the aviation and aerospace broking industry, which, for Aon in 2016, represented less than $100 million in global revenue. The European Commission has now assumed jurisdiction over the investigation in place of the FCA. Other antitrust agencies outside the European Union are also conducting formal or informal investigations regarding these matters. Aon intends to work diligently with all antitrust agencies concerned to ensure they can carry out their work as efficiently as possible. At this time, in light of the uncertainties and many variables involved, weAon cannot estimate the ultimate impact on our company from these investigations or any related private litigation, nor any damages, penalties, or fines related to them. There can be no assurance that the ultimate resolution of these matters will not have a material adverse effect on ~~our~~the Company’s consolidated financial position, results of operations, or liquidity.

~~Aon UK Limited, an indirect wholly-owned subsidiary~~Guarantees and Indemnifications

The Company provides a variety of guarantees and indemnifications to its customers and others. The maximum potential amount of future payments represents the ~~Company, is presently engaged in several internal regulatory reviews~~notional amounts that could become payable under the guarantees and ~~ongoing interactions with~~indemnifications if there were a total default by the ~~FCA concerning Aon UK Limited’s systems~~guaranteed parties, without consideration of possible recoveries under recourse provisions or other methods. These amounts may bear no relationship to the expected future payments, if any, for these guarantees and ~~controls. These interactions may result in additional charges above~~indemnifications. Any anticipated amounts ~~accrued for to date in connection with these reviews.~~

~~Settled/Closed Matters~~

~~On June 1, 2007, the International Road Transport Union (“IRU”) sued Aon~~payable are included in the ~~Geneva Tribunal of First Instance in Switzerland. IRU alleges, among other things,~~Company’s Financial Statements, and are recorded at fair value.

The Company expects that, ~~between 1995~~as prudent business interests dictate, additional guarantees and 2004, a business acquired by Aon and, later, an Aon subsidiary (1) accepted commissions for certain insurance placements that violated a fee agreement entered between the parties and (2) negligently failedindemnifications may be issued from time to ask certain insurance carriers to contribute to the IRU’s risk management costs. IRU sought damages of approximately CHF 46 million ($47 million at June 30, 2017 exchange rates) and $3 million, plus legal fees and interest of approximately $30 million. On December 2, 2014, the Geneva Tribunal of First Instance entered a judgment that accepted some, and rejected other, of IRU’s claims. The judgment awarded IRU CHF 16.8 million ($17 million at June 30, 2017 exchange rates) and $3.1 million, plus interest and adverse costs. The entire amount of the judgment, including interest through December 31, 2014, totaled CHF 27.9 million ($28 million at December 31, 2014 exchange rates) and $5 million. On January 26, 2015, in return for IRU agreeing not to appeal the bulk of its dismissed claims, the Aon subsidiary agreed not to appeal a part of the judgment and to pay IRU CHF 12.8 million ($14 million at January 31, 2015 exchange rates) and $4.7 million without Aon admitting liability. The Aon subsidiary appealed those aspects of the judgment it retained the right to appeal. IRU did not appeal. After the Geneva Appellate Court affirmed the judgment of the Geneva Tribunal of First Instance, the Aon subsidiary filed an appeal with the Swiss Federal Tribunal. By judgment issued June 16, 2017, the Swiss Federal Tribunal affirmed in part and reversed in part the appellate judgment and remanded the case to the appellate court. IRU and the Aon subsidiary agreed that the Aon subsidiary would pay IRU CHF 15.0 million ($15 million at June 30, 2017 exchange rates) and $344,000. As a result of this agreement, the legal proceedings between IRU and the Aon subsidiary have been discontinued.

~~Guarantees and Indemnifications~~time.

Redomestication

In connection with the ~~redomicile of Aon’s headquarters (the “Redomestication”),~~Redomestication, the Company on April 2, 2012 entered into various agreements pursuant to which it agreed to guarantee the obligations of its subsidiaries arising under issued and outstanding debt securities. Those agreements included the (1) Amended and Restated Indenture, dated as of April 2, 2012, among Aon Corporation, Aon plc, and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”) (amending and restating the Indenture, dated as of September 10, 2010, between Aon Corporation and the Trustee), (2) Amended and Restated Indenture, dated as of April 2, 2012, among Aon Corporation, Aon plc and the Trustee (amending and restating the Indenture, dated as of December 16, 2002, between Aon Corporation and the Trustee), and (3) Amended and Restated Indenture, dated as of April 2, 2012, among Aon Corporation, Aon plc and the Trustee (amending and restating the Indenture, dated as of January 13, 1997, as supplemented by the First Supplemental Indenture, dated as of January 13, 1997), and (4) First Supplemental Indenture, dated as of April 2, 2012, among Aon Finance N.S. 1, ULC, as issuer, Aon Corporation, as guarantor, Aon plc, as guarantor, and Computershare Trust Company of Canada, as trustee.

The Company provides a variety of guarantees and indemnifications to its customers and others. The maximum potential amount of future payments represents the notional amounts that could become payable under the guarantees and indemnifications if there were a total default by the guaranteed parties, without consideration of possible recoveries under recourse provisions or other methods. These amounts may bear no relationship to the expected future payments, if any, for these guarantees and indemnifications. Any anticipated amounts payable are included in the Company’s Condensed Consolidated Financial Statements, and are recorded at fair value.

~~The Company expects that, as prudent business interests dictate, additional guarantees and indemnifications may be issued from time to time.~~.

Sale of the Divested Business

In connection with the sale of the Divested Business, the Company guaranteed future operating lease commitments related to certain facilities assumed by the Buyer. The Company is obligated to perform under the guarantees if the Divested Business defaults on such leases at any time during the remainder of the lease agreements, which expire on various dates through 2024. As of ~~September 30, 2017,~~March 31, 2019, the undiscounted maximum potential future payments under the lease guarantee is ~~$104~~$81 million, with an estimated fair value of ~~$25~~$16 million. No cash payments were made in connection to the lease commitments during the three ~~or nine~~ months ended ~~September 30, 2017.~~March 31, 2019.

Additionally, the Company is subject to performance guarantee requirements under certain client arrangements that were assumed by the Buyer. Should the Divested Business fail to perform as required by the terms of the arrangements, the Company would be required to fulfill the remaining contract terms, which expire on various dates through 2023. As of ~~September 30, 2017,~~March 31, 2019, the undiscounted maximum potential future payments under the performance guarantees were ~~$395~~$179 million, with an estimated fair value of $4$1 million. No cash payments were made in connection to the performance guarantees during the three ~~or nine~~ months ended ~~September 30, 2017.~~March 31, 2019.

Letters of Credit

Aon has entered into a number of arrangements whereby the Company’s performance on certain obligations is guaranteed by a third party through the issuance of letters of credit (“LOCs”). The Company had total LOCs outstanding of approximately ~~$94~~$92 million at ~~September 30, 2017,~~March 31, 2019, compared to ~~$90~~$83 million at December 31, ~~2016.~~2018. These ~~letters of credit~~LOCs cover the beneficiaries related to certain of Aon’s U.S. and Canadian non-qualified pension plan schemes and secure deductible retentions for Aon’s own workers compensation program. The Company has also obtained LOCs to cover contingent payments for taxes and other business obligations to third parties, and other guarantees for miscellaneous purposes at its international subsidiaries.

Premium Payments

The Company has certain contractual contingent guarantees for premium payments owed by clients to certain insurance companies. The maximum exposure with respect to such contractual contingent guarantees was approximately $76 million at ~~September 30, 2017~~March 31, 2019 compared to ~~$95~~$103 million at December 31, ~~2016.~~2018.

~~17.~~ 18. Segment Information

Beginning in the first quarter of 2017 and following the Transaction described in Note 3 “Discontinued Operations,” the Company began leading a set of initiatives designed to strengthen Aon and unite the firm with one portfolio of capability enabled by proprietary data and analytics and one operating model to deliver additional insight, connectivity and efficiency. These initiatives reinforce Aon’s return on invested capital (“ROIC”) decision-making process and emphasis on free cash flow. The Company ~~is now operating~~

operates as one segment that includes all of Aon’s continuing operations, which as a global professional services firm provides advice and solutions to clients focused on risk, retirement, and health through five revenue lines which make up its principal products and services. The ~~CODM~~Chief Operating Decision Maker (the “CODM”) assesses the performance of the Company and allocates resources based on one ~~company:~~segment: Aon United.

The Company’s reportable operating segment has been determined using a management approach, which is consistent with the basis and manner in which Aon’s CODM uses financial information for the purposes of allocating resources and evaluating performance. The CODM assesses performance and allocates resources based on total Aon results against its key four metrics, including organic revenue growth, expense discipline, and collaborative behaviors that maximize value for Aon and its shareholders, regardless of which revenue line it benefits.

Prior period comparative segment information has been restated to conform with current year presentation. In prior periods, the Company did not include unallocated expenses in segment operating income, which represented corporate governance costs not allocated to the previous operating segments. These costs are now reflected within operating expenses for the current and prior period.

~~Revenue from continuing operations for each of the Company’s principal product and service lines is as follows (in millions):~~

Three months ended September 30 Nine months ended September 30
2017 2016 2017 2016
Commercial Risk Solutions $ 917
$ 884
$ 2,943
$ 2,835
Reinsurance Solutions 355
329
1,070
1,032
Retirement Solutions 491
466
1,266
1,266
Health Solutions 293
265
977
838
Data & Analytic Services 289
260
842
794
Elimination (5 ) (3 ) (9 ) (6 )
Total revenue $ 2,340
$ 2,201
$ 7,089
$ 6,759

As Aon ~~is operating~~operates as one segment, segment profit or loss is consistent with consolidated reporting as disclosed on the Condensed Consolidated Statements of Income.

~~The geographic distribution of Aon’s total~~ Refer to Note 3 “Revenue from Contracts with Customers” for further information on revenue ~~or long-lived assets did not change as a result of the change in reportable operating segments described above.~~by principal service line.

~~18.~~ 19. Guarantee of Registered Securities

As described in Note ~~16 “Commitments~~17 “Claims, Lawsuits, and Other Contingencies,” in connection with the Redomestication, Aon plc entered into various agreements pursuant to which it agreed to guarantee the obligations of Aon Corporation arising under issued and outstanding debt securities, including the 5.00% Notes due September 2020, the 8.205% Notes due January 2027, and the 6.25% Notes due September 2040 (collectively, the “Aon ~~Corp~~Corporation Notes”). Additionally, Aon plc has guaranteed the obligations of Aon Corporation arising under the 4.50% Senior Notes due 2028. Aon Corporation is a 100% indirectly owned subsidiary of Aon plc. All guarantees of Aon plc are full and unconditional. There are no other subsidiaries of Aon plc that are guarantors of the Aon ~~Corp~~Corporation Notes.

In addition, Aon Corporation entered into an agreement pursuant to which it ~~agreed to guarantee~~guaranteed the obligations of Aon plc arising under the 4.25% Notes due 2042 exchanged for Aon Corporation’s outstanding 8.205% Notes due January 2027, and has also ~~agreed to guarantee~~guaranteed the obligations of Aon plc arising under the 4.45% Notes due 2043, the 4.00% Notes due November 2023, the 2.875% Notes due May 2026, the 3.50% Notes due June 2024, the 4.60% Notes due June 2044, the 4.75% Notes due May 2045, the 2.80% Notes due March 2021, and the 3.875% Notes due December 2025 (collectively, the “Aon plc Notes”). In each case, the guarantee of Aon Corporation is full and unconditional. There are no subsidiaries of Aon plc, other than Aon Corporation, that are guarantors of the Aon plc Notes. As a result of the existence of these guarantees, the Company has elected to present the financial information set forth in this footnote in accordance with Rule 3-10 of Regulation S-X.

In the forth quarter of 2018, Aon plc obtained direct ownership in two subsidiaries that were previously indirectly owned by Aon Corporation. In the first quarter of 2019, Aon Corporation obtained indirect ownership of subsidiaries that were previously indirectly owned by Aon plc. The financial results of both subsidiaries are included in the Other Non-Guarantor Subsidiaries column of the Condensed Consolidating Financial Statements. The Company has retrospectively reflected the impact of these transactions on the Condensed Consolidating Statements of Income and Condensed Consolidating Statements of Comprehensive Income for the periods ended March 31, 2018 and the Condensed Consolidated Statement of Financial Position as of December 31, 2018.

The following tables set forth Condensed Consolidating Statements of Income ~~for the three~~ and ~~nine months ended September 30, 2017 and 2016,~~ Condensed Consolidating Statements of Comprehensive Income for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2019 and ~~2016,~~2018, Condensed Consolidating Statements of Financial Position as of ~~September 30, 2017~~March 31, 2019 and December 31, ~~2016,~~2018, and Condensed Consolidating Statements of Cash Flows for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2019 and ~~2016~~2018 in accordance with Rule 3-10 of Regulation S-X. The ~~condensed consolidating financial information~~Condensed Consolidating Financial

Information includes the accounts of Aon plc, the accounts of Aon Corporation, and the combined accounts of the ~~non-guarantor subsidiaries.~~Other Non-Guarantor Subsidiaries. The ~~condensed consolidating financial statements~~Condensed Consolidating Financial Statements are presented in all periods as a merger under common ~~control, with Aon plc presented as the parent company in all periods prior and subsequent to the Redomestication.~~control. The principal consolidating adjustments are to eliminate the investment in subsidiaries and intercompany balances and transactions.

As described in Note 1 “Basis of Presentation,” and consistent with the Company’s Condensed Consolidated Financial Statements, the following tables present the financial results of the Divested Business as discontinued operations for all periods presented within non-guarantor Subsidiaries. The impact of intercompany transactions have been reflected within continuing operations in the Condensed Consolidating Financial Statements.

Condensed Consolidating Statement of Income


	Three months ended September 30, 2017
								Other
	Aon				Aon			Non-Guarantor			Consolidating						Three Months Ended March 31, 2019
(millions)	plc				Corporation			Subsidiaries			Adjustments			Consolidated			Aon plc			Aon Corporation			Other Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Revenue
Total revenue	$	—			$	—		$	2,340		$	—		$	2,340		$	—		$	—		$	3,143		$	—		$	3,143
Expenses
Compensation and benefits	25				20			1,374			—			1,419			20			8			1,556			—			1,584
Information technology	—				—			109			—			109			—			—			117			—			117
Premises	—				—			89			—			89			—			4			83			—			87
Depreciation of fixed assets	—				—			40			—			40			—			—			40			—			40
Amortization and impairment of intangible assets	—				—			101			—			101			—			—			97			—			97
Other general expenses (income)	1				1			315			—			317			—			(4		)	350			—			346
Total operating expenses	26				21			2,028			—			2,075			20			8			2,243			—			2,271
Operating income (loss)	(26		)		(21		)	312			—			265			(20		)	(8		)	900			—			872
Interest income	—				18			—			(8		)	10			—			9			—			(7		)	2
Interest expense	(53		)		(24		)	(1		)	8			(70		)	(46		)	(28		)	(5		)	7			(72		)
Intercompany interest income (expense)	3				(135		)	132			—			—			4			(116		)	112			—			—
Intercompany other income (expense)	291				(271		)	(20		)	—			—			31			(99		)	68			—			—
Other income (expense)	(2		)		14			(17		)	—			(5		)	5			(11		)	8			(2		)	—
Income (loss) from continuing operations before income taxes	213				(419		)	406			—			200			(26		)	(253		)	1,083			(2		)	802
Income tax benefit (expense)	(8		)		(81		)	93			—			4
Income tax expense (benefit)																	(5		)	(42		)	173			—			126
Net income (loss) from continuing operations	221				(338		)	313			—			196			(21		)	(211		)	910			(2		)	676
Income (loss) from discontinued operations, net of tax	—				—			(4		)	—			(4		)
Net income from discontinued operations																	—			—			—			—			—
Net income (loss) before equity in earnings of subsidiaries	221				(338		)	309			—			192			(21		)	(211		)	910			(2		)	676
Equity in earnings of subsidiaries, net of tax	(36		)		122			(216		)	130			—
Equity in earnings of subsidiaries																	682			724			513			(1,919		)	—
Net income	185				(216		)	93			130			192			661			513			1,423			(1,921		)	676
Less: Net income attributable to noncontrolling interests	—			��	—			7			—			7			—			—			17			—			17
Net income (loss) attributable to Aon shareholders	$	185			$	(216	)	$	86		$	130		$	185
Net income attributable to Aon shareholders																	$	661		$	513		$	1,406		$	(1,921	)	$	659

Condensed Consolidating Statement of Income


	Three months ended September 30, 2016
							Other
	Aon			Aon			Non-Guarantor			Consolidating						Three Months Ended March 31, 2018
(millions)	plc			Corporation			Subsidiaries			Adjustments			Consolidated			Aon plc			Aon Corporation			Other Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Revenue
Total revenue	$	—		$	—		$	2,201		$	—		$	2,201		$	—		$	—		$	3,090		$	—		$	3,090
Expenses
Compensation and benefits	25			4			1,271			—			1,300			19			1			1,596			—			1,616
Information technology	—			—			99			—			99			—			—			115			—			115
Premises	—			—			86			—			86			—			—			93			—			93
Depreciation of fixed assets	—			—			39			—			39			—			—			39			—			39
Amortization and impairment of intangible assets	—			—			42			—			42			—			—			110			—			110
Other general expenses (income)	(1		)	3			265			—			267			1			—			317			—			318
Total operating expenses	24			7			1,802			—			1,833			20			1			2,270			—			2,291
Operating income (loss)	(24		)	(7		)	399			—			368			(20		)	(1		)	820			—			799
Interest income	—			4			5			(8		)	1			—			14			—			(10		)	4
Interest expense	(51		)	(24		)	(3		)	8			(70		)	(49		)	(24		)	(7		)	10			(70		)
Intercompany interest income (expense)	3			(135		)	132			—			—			4			(128		)	124			—			—
Intercompany other income (expense)	328			(277		)	(51		)	—			—			(53		)	(5		)	58			—			—
Other income (expense)	(5		)	1			11			3			10			(25		)	(6		)	13			3			(15		)
Income (loss) from continuing operations before income taxes	251			(438		)	493			3			309			(143		)	(150		)	1,008			3			718
Income tax benefit (expense)	13			(93		)	105			—			25
Income tax expense (benefit)																(16		)	(27		)	157			—			114
Net income (loss) from continuing operations	238			(345		)	388			3			284			(127		)	(123		)	851			3			604
Income (loss) from discontinued operations, net of tax	—			—			42			—			42
Net income from discontinued operations																—			—			6			—			6
Net income (loss) before equity in earnings of subsidiaries	238			(345		)	430			3			326			(127		)	(123		)	857			3			610
Equity in earnings of subsidiaries, net of tax	78			225			(120		)	(183		)	—
Equity in earnings of subsidiaries																718			705			582			(2,005		)	—
Net income	316			(120		)	310			(180		)	326			591			582			1,439			(2,002		)	610
Less: Net income attributable to noncontrolling interests	—			—			7			—			7			—			—			16			—			16
Net income (loss) attributable to Aon shareholders	$	316		$	(120	)	$	303		$	(180	)	$	319
Net income attributable to Aon shareholders																$	591		$	582		$	1,423		$	(2,002	)	$	594

~~Condensed Consolidating Statement of Income~~

Nine months ended September 30, 2017
Other
Aon Aon Non-Guarantor Consolidating
(millions) plc Corporation Subsidiaries Adjustments Consolidated
Revenue
Total revenue $ —
$ —
$ 7,089
$ —
$ 7,089
Expenses
Compensation and benefits 85
31
4,221
—
4,337
Information technology —
—
295
—
295
Premises —
—
259
—
259
Depreciation of fixed assets —
—
148
—
148
Amortization and impairment of intangible assets —
—
604
—
604
Other general expenses (income) 10
(3 ) 949
—
956
Total operating expenses 95
28
6,476
—
6,599
Operating income (loss) (95 ) (28 ) 613
—
490
Interest income —
35
—
(15 ) 20
Interest expense (144 ) (71 ) (11 ) 15
(211 )
Intercompany interest income (expense) 10
(407 ) 397
—
—
Intercompany other income (expense) 189
(280 ) 91
—
—
Other income (expense) (25 ) 22
(35 ) 18
(20 )
Income (loss) from continuing operations before income taxes (65 ) (729 ) 1,055
18
279
Income tax benefit (expense) (30 ) (198 ) 89
—
(139 )
Net income (loss) from continuing operations (35 ) (531 ) 966
18
418
Income (loss) from discontinued operations, net of tax —
—
857
—
857
Net income (loss) before equity in earnings of subsidiaries (35 ) (531 ) 1,823
18
1,275
Equity in earnings of subsidiaries, net of tax 1,262
1,028
497
(2,787 ) —
Net income 1,227
497
2,320
(2,769 ) 1,275
Less: Net income attributable to noncontrolling interests —
—
30
—
30
Net income (loss) attributable to Aon shareholders $ 1,227
$ 497
$ 2,290
$ (2,769 ) $ 1,245

~~Condensed Consolidating Statement of Income~~

Nine months ended September 30, 2016
Other
Aon Aon Non-Guarantor Consolidating
(millions) plc Corporation Subsidiaries Adjustments Consolidated
Revenue
Total revenue $ —
$ —
$ 6,759
$ —
$ 6,759
Expenses
Compensation and benefits 76
10
3,955
—
4,041
Information technology —
—
281
—
281
Premises —
—
257
—
257
Depreciation of fixed assets —
—
118
—
118
Amortization and impairment of intangible assets —
—
117
—
117
Other general expenses (income) 5
7
758
—
770
Total operating expenses 81
17
5,486
—
5,584
Operating income (loss) (81 ) (17 ) 1,273
—
1,175
Interest income —
13
14
(21 ) 6
Interest expense (145 ) (78 ) (10 ) 21
(212 )
Intercompany interest income (expense) 10
(405 ) 395
—
—
Intercompany other income (expense) 217
(292 ) 75
—
—
Other income (expense) (3 ) (8 ) 39
(1 ) 27
Income (loss) from continuing operations before income taxes (2 ) (787 ) 1,786
(1 ) 996
Income tax benefit (expense) (33 ) (219 ) 379
—
127
Net income (loss) from continuing operations 31
(568 ) 1,407
(1 ) 869
Income (loss) from discontinued operations, net of tax —
—
102
—
102
Net income (loss) before equity in earnings of subsidiaries 31
(568 ) 1,509
(1 ) 971
Equity in earnings of subsidiaries, net of tax 914
836
268
(2,018 ) —
Net income 945
268
1,777
(2,019 ) 971
Less: Net income attributable to noncontrolling interests —
—
27
—
27
Net income (loss) attributable to Aon shareholders $ 945
$ 268
$ 1,750
$ (2,019 ) $ 944

Condensed Consolidating Statement of Comprehensive Income

Three months ended September 30, 2017
Other
Aon Aon Non-Guarantor Consolidating
(millions) plc Corporation Subsidiaries Adjustments Consolidated
Net income (loss) $ 185
$ (216 ) $ 93
$ 130
$ 192
Less: Net income attributable to noncontrolling interests —
—
7
—
7
Net income (loss) attributable to Aon shareholders 185
(216 ) 86
130
185
Other comprehensive income (loss), net of tax:
Change in fair value of financial instruments —
3
8
—
11
Foreign currency translation adjustments —
—
243
—
243
Post-retirement benefit obligation —
7
11
—
18
Total other comprehensive income (loss) —
10
262
—
272
Equity in other comprehensive income (loss) of subsidiaries, net of tax 265
245
255
(765 ) —
Less: Other comprehensive income attributable to noncontrolling interests —
—
7
—
7
Total other comprehensive income (loss) attributable to Aon shareholders 265
255
510
(765 ) 265
Comprehensive income (loss) attributable to Aon shareholders $ 450
$ 39
$ 596
$ (635 ) $ 450



	Three Months Ended March 31, 2019
(millions)	Aon plc		Aon Corporation		Other Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
Net income	$	661	$	513	$	1,423	$	(1,921	)	$	676
Less: Net income attributable to noncontrolling interests	—		—		17		—			17
Net income attributable to Aon shareholders	661		513		1,406		(1,921		)	659
Other comprehensive income, net of tax:
Change in fair value of financial instruments	—		2		5		—			7
Foreign currency translation adjustments	—		—		131		2			133
Postretirement benefit obligation	—		22		9		—			31
Total other comprehensive income	—		24		145		2			171
Equity in other comprehensive income of subsidiaries, net of tax	167		115		139		(421		)	—
Less: Other comprehensive income attributable to noncontrolling interests	—		—		2		—			2
Total other comprehensive income attributable to Aon shareholders	167		139		282		(419		)	169
Comprehensive income attributable to Aon shareholders	$	828	$	652	$	1,688	$	(2,340	)	$	828

Condensed Consolidating Statement of Comprehensive Income



	Three Months Ended March 31, 2018
(millions)	Aon plc		Aon Corporation		Other Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
Net income	$	591	$	582	$	1,439	$	(2,002	)	$	610
Less: Net income attributable to noncontrolling interests	—		—		16		—			16
Net income attributable to Aon shareholders	591		582		1,423		(2,002		)	594
Other comprehensive income, net of tax:
Change in fair value of financial instruments	—		3		11		—			14
Foreign currency translation adjustments	—		—		250		(3		)	247
Postretirement benefit obligation	—		11		37		—			48
Total other comprehensive income	—		14		298		(3		)	309
Equity in other comprehensive income of subsidiaries, net of tax	309		285		299		(893		)	—
Less: Other comprehensive income attributable to noncontrolling interests	—		—		3		—			3
Total other comprehensive income attributable to Aon shareholders	309		299		594		(896		)	306
Comprehensive income attributable to Aon shareholders	$	900	$	881	$	2,017	$	(2,898	)	$	900

Three months ended September 30, 2016
Other
Aon Aon Non-Guarantor Consolidating
(millions) plc Corporation Subsidiaries Adjustments Consolidated
Net income (loss) $ 316
$ (120 ) $ 310
$ (180 ) $ 326
Less: Net income attributable to noncontrolling interests —
—
7
—
7
Net income (loss) attributable to Aon shareholders 316
(120 ) 303
(180 ) 319
Other comprehensive income (loss), net of tax:
Change in fair value of financial instruments —
1
(1 ) —
—
Foreign currency translation adjustments —
1
(87 ) (3 ) (89 )
Post-retirement benefit obligation —
7
11
—
18
Total other comprehensive income (loss) —
9
(77 ) (3 ) (71 )
Equity in other comprehensive income (loss) of subsidiaries, net of tax (68 ) (83 ) (74 ) 225
—
Less: Other comprehensive income attributable to noncontrolling interests —
—
—
—
—
Total other comprehensive income (loss) attributable to Aon shareholders (68 ) (74 ) (151 ) 222
(71 )
Comprehensive income (loss) attributable to Aon shareholders $ 248
$ (194 ) $ 152
$ 42
$ 248

~~Condensed Consolidating Statement of Comprehensive Income~~

Nine months ended September 30, 2017
Other
Aon Aon Non-Guarantor Consolidating
(millions) plc Corporation Subsidiaries Adjustments Consolidated
Net income (loss) $ 1,227
$ 497
$ 2,320
$ (2,769 ) $ 1,275
Less: Net income attributable to noncontrolling interests —
—
30
—
30
Net income (loss) attributable to Aon shareholders 1,227
497
2,290
(2,769 ) 1,245
Other comprehensive income (loss), net of tax:
Change in fair value of financial instruments —
3
10
—
13
Foreign currency translation adjustments —
—
452
(18 ) 434
Post-retirement benefit obligation —
23
33
—
56
Total other comprehensive income (loss) —
26
495
(18 ) 503
Equity in other comprehensive income (loss) of subsidiaries, net of tax 518
480
506
(1,504 ) —
Less: Other comprehensive income attributable to noncontrolling interests —
—
3
—
3
Total other comprehensive income (loss) attributable to Aon shareholders 518
506
998
(1,522 ) 500
Comprehensive income (loss) attributable to Aon shareholders $ 1,745
$ 1,003
$ 3,288
$ (4,291 ) $ 1,745

~~Condensed Consolidating Statement of Comprehensive Income~~

Nine months ended September 30, 2016
Other
Aon Aon Non-Guarantor Consolidating
(millions) plc Corporation Subsidiaries Adjustments Consolidated
Net income (loss) $ 945
$ 268
$ 1,777
$ (2,019 ) $ 971
Less: Net income attributable to noncontrolling interests —
—
27
—
27
Net income (loss) attributable to Aon shareholders 945
268
1,750
(2,019 ) 944
Other comprehensive income (loss), net of tax:
Change in fair value of financial instruments —
1
(12 ) —
(11 )
Foreign currency translation adjustments (2 ) 22
(248 ) 1
(227 )
Post-retirement benefit obligation —
23
(155 ) —
(132 )
Total other comprehensive income (loss) (2 ) 46
(415 ) 1
(370 )
Equity in other comprehensive income (loss) of subsidiaries, net of tax (369 ) (425 ) (379 ) 1,173
—
Less: Other comprehensive income attributable to noncontrolling interests —
—
—
—
—
Total other comprehensive income (loss) attributable to Aon shareholders (371 ) (379 ) (794 ) 1,174
(370 )
Comprehensive income (loss) attributable to Aon shareholders $ 574
$ (111 ) $ 956
$ (845 ) $ 574

Condensed Consolidating Statement of Financial Position


	As of September 30, 2017
					Other
	Aon		Aon		Non-Guarantor		Consolidating					As of March 31, 2019
(millions)	plc		Corporation		Subsidiaries		Adjustments			Consolidated		Aon plc		Aon Corporation			Other Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
ASSETS
CURRENT ASSETS
Assets
Current assets
Cash and cash equivalents	$	—	$	3,110	$	802	$	(3,163	)	$	749	$	—	$	746		$	563		$	(709	)	$	600
Short-term investments	—		1,467		173		—			1,640		—		47			87			—			134
Receivables, net	—		2		2,066		—			2,068		—		—			3,242			—			3,242
Fiduciary assets	—		—		9,292		—			9,292		—		—			11,412			—			11,412
Intercompany receivables	110		4,860		12,436		(17,406		)	—
Current intercompany receivables												166		2,277			12,154			(14,597		)	—
Other current assets	—		37		481		—			518		—		10			521			—			531
Current assets of discontinued operations	—		—		—		—			—
Total Current Assets	110		9,476		25,250		(20,569		)	14,267
Total current assets												166		3,080			27,979			(15,306		)	15,919
Goodwill	—		—		7,888		—			7,888		—		—			8,219			—			8,219
Intangible assets, net	—		—		1,341		—			1,341		—		—			1,077			—			1,077
Fixed assets, net	—		—		545		—			545		—		—			606			—			606
Operating lease right-of-use assets												—		114			879			—			993
Deferred tax assets	135		664		173		(407		)	565		94		488			150			(144		)	588
Intercompany receivables	391		261		8,728		(9,380		)	—
Prepaid pension	—		5		1,015		—			1,020		—		5			1,219			—			1,224
Non-current intercompany receivables												401		262			7,202			(7,865		)	—
Other non-current assets	1		49		248		—			298		1		30			478			—			509
Investment in subsidiary	11,900		17,748		509		(30,157		)	—		9,283		19,919			(355		)	(28,847		)	—
Non-current assets of discontinued operations	—		—		—		—			—
TOTAL ASSETS	$	12,537	$	28,203	$	45,697	$	(60,513	)	$	25,924
Total assets												$	9,945	$	23,898		$	47,454		$	(52,162	)	$	29,135

LIABILITIES AND EQUITY
LIABILITIES
CURRENT LIABILITIES
Liabilities and equity
Liabilities
Current liabilities
Accounts payable and accrued liabilities	$	2,929	$	37	$	1,785	$	(3,163	)	$	1,588	$	351	$	75		$	1,762		$	(709	)	$	1,479
Short-term debt and current portion of long-term debt	—		—		305		—			305		248		175			3			—			426
Fiduciary liabilities	—		—		9,292		—			9,292		—		—			11,412			—			11,412
Intercompany payables	147		15,951		1,308		(17,406		)	—
Current intercompany payables												339		13,283			975			(14,597		)	—
Other current liabilities	24		54		1,211		—			1,289		—		81			1,139			—			1,220
Current liabilities of discontinued operations	—		—		—		—			—
Total Current Liabilities	3,100		16,042		13,901		(20,569		)	12,474
Total current liabilities												938		13,614			15,291			(15,306		)	14,537
Long-term debt	4,247		1,414		1		—			5,662		4,228		1,762			—			—			5,990
Non-current operating lease liabilities												—		153			825			—			978
Deferred tax liabilities	—		—		490		(407		)	83		—		—			349			(144		)	205
Pension, other post-retirement and other post-employment liabilities	—		1,234		378		—			1,612
Intercompany payables	—		8,894		486		(9,380		)	—
Pension, other postretirement and postemployment liabilities												—		1,241			349			—			1,590
Non-current intercompany payables												—		7,368			497			(7,865		)	—
Other non-current liabilities	15		110		721		—			846		4		115			854			—			973
Non-current liabilities of discontinued operations	—		—		—		—			—
TOTAL LIABILITIES	7,362		27,694		15,977		(30,356		)	20,677
Total liabilities												5,170		24,253			18,165			(23,315		)	24,273

TOTAL AON SHAREHOLDERS’ EQUITY	5,175		509		29,648		(30,157		)	5,175
Equity
Total Aon shareholders’ equity												4,775		(355		)	29,202			(28,847		)	4,775
Noncontrolling interests	—		—		72		—			72		—		—			87			—			87
TOTAL EQUITY	5,175		509		29,720		(30,157		)	5,247
TOTAL LIABILITIES AND EQUITY	$	12,537	$	28,203	$	45,697	$	(60,513	)	$	25,924
Total equity												4,775		(355		)	29,289			(28,847		)	4,862
Total liabilities and equity												$	9,945	$	23,898		$	47,454		$	(52,162	)	$	29,135

Condensed Consolidating Statement of Financial Position



	As of December 31, 2018
(millions)	Aon plc		Aon Corporation			Other Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Assets
Current assets
Cash and cash equivalents	$	—	$	862		$	575		$	(781	)	$	656
Short-term investments	—		56			116			—			172
Receivables, net	—		—			2,760			—			2,760
Fiduciary assets	—		—			10,166			—			10,166
Current intercompany receivables	191		897			11,634			(12,722		)	—
Other current assets	—		16			602			—			618
Total current assets	191		1,831			25,853			(13,503		)	14,372
Goodwill	—		—			8,171			—			8,171
Intangible assets, net	—		—			1,149			—			1,149
Fixed assets, net	—		—			588			—			588
Operating lease right-of-use assets	—		—			—			—			—
Deferred tax assets	94		467			144			(144		)	561
Prepaid pension	—		5			1,128			—			1,133
Non-current intercompany receivables	403		261			7,225			(7,889		)	—
Other non-current assets	1		30			417			—			448
Investment in subsidiary	8,433		19,132			(882		)	(26,683		)	—
Total assets	$	9,122	$	21,726		$	43,793		$	(48,219	)	$	26,422

Liabilities and equity
Liabilities
Current liabilities
Accounts payable and accrued liabilities	$	274	$	70		$	2,380		$	(781	)	$	1,943
Short-term debt and current portion of long-term debt	250		—			1			—			251
Fiduciary liabilities	—		—			10,166			—			10,166
Current intercompany payables	213		11,875			634			(12,722		)	—
Other current liabilities	—		69			867			—			936
Total current liabilities	737		12,014			14,048			(13,503		)	13,296
Long-term debt	4,231		1,762			—			—			5,993
Non-current operating lease liabilities	—		—			—			—			—
Deferred tax liabilities	—		—			325			(144		)	181
Pension, other postretirement and postemployment liabilities	—		1,275			361			—			1,636
Non-current intercompany payables	—		7,390			499			(7,889		)	—
Other non-current liabilities	3		167			927			—			1,097
Total liabilities	4,971		22,608			16,160			(21,536		)	22,203

Equity
Total Aon shareholders’ equity	4,151		(882		)	27,565			(26,683		)	4,151
Noncontrolling interests	—		—			68			—			68
Total equity	4,151		(882		)	27,633			(26,683		)	4,219
Total liabilities and equity	$	9,122	$	21,726		$	43,793		$	(48,219	)	$	26,422

As of December 31, 2016
Other
Aon Aon Non-Guarantor Consolidating
(millions) plc Corporation Subsidiaries Adjustments Consolidated
ASSETS

CURRENT ASSETS
Cash and cash equivalents $ —
$ 1,633
$ 655
$ (1,862 ) $ 426
Short-term investments —
140
150
—
290
Receivables, net —
3
2,103
—
2,106
Fiduciary assets —
—
8,959
—
8,959
Intercompany receivables 105
1,880
9,825
(11,810 ) —
Other current assets —
25
222
—
247
Current assets of discontinued operations —
—
1,118
—
1,118
Total Current Assets 105
3,681
23,032
(13,672 ) 13,146
Goodwill —
—
7,410
—
7,410
Intangible assets, net —
—
1,890
—
1,890
Fixed assets, net —
—
550
—
550
Deferred tax assets 134
726
171
(706 ) 325
Intercompany receivables 366
261
8,711
(9,338 ) —
Prepaid pension —
5
853
—
858
Other non-current assets 2
119
239
—
360
Investment in subsidiary 10,107
17,131
(356 ) (26,882 ) —
Non-current assets of discontinued operations —
—
2,076
—
2,076
TOTAL ASSETS $ 10,714
$ 21,923
$ 44,576
$ (50,598 ) $ 26,615

LIABILITIES AND EQUITY

LIABILITIES
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 585
$ 44
$ 2,837
$ (1,862 ) $ 1,604
Short-term debt and current portion of long-term debt 279
50
7
—
336
Fiduciary liabilities —
—
8,959
—
8,959
Intercompany payables 142
10,399
1,269
(11,810 ) —
Other current liabilities —
63
593
—
656
Current liabilities of discontinued operations —
—
940
—
940
Total Current Liabilities 1,006
10,556
14,605
(13,672 ) 12,495
Long-term debt 4,177
1,413
279
—
5,869
Deferred tax liabilities —
—
759
(658 ) 101
Pension, other post-retirement and other post-employment liabilities —
1,356
404
—
1,760
Intercompany payables —
8,877
461
(9,338 ) —
Other non-current liabilities 8
77
634
—
719
Non-current liabilities of discontinued operations —
—
139
—
139
TOTAL LIABILITIES 5,191
22,279
17,281
(23,668 ) 21,083

TOTAL AON SHAREHOLDERS’ EQUITY 5,523
(356 ) 27,238
(26,930 ) 5,475
Noncontrolling interests —
—
57
—
57
TOTAL EQUITY 5,523
(356 ) 27,295
(26,930 ) 5,532
TOTAL LIABILITIES AND EQUITY $ 10,714
$ 21,923
$ 44,576
$ (50,598 ) $ 26,615

Condensed Consolidating Statement of Cash Flows

Nine months ended September 30, 2017
Aon Aon
Other
Non-Guarantor
Consolidating
(millions) plc Corporation Subsidiaries Adjustments Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES

Cash provided by (used for) operating activities - continuing operations $ (135 ) $ 999
$ 987
$ (1,562 ) $ 289
Cash provided by operating activities - discontinued operations —
—
64
—
64
CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES (135 ) 999
1,051
(1,562 ) 353

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from investments —
576
11
(544 ) 43
Payments for investments (16 ) (25 ) (571 ) 557
(55 )
Net purchases of short-term investments - non-fiduciary —
(1,328 ) (16 ) —
(1,344 )
Acquisition of businesses, net of cash acquired —
1
(173 ) —
(172 )
Sale of businesses, net of cash sold —
—
4,194
—
4,194
Capital expenditures —
—
(125 ) —
(125 )
Cash provided by (used for) investing activities - continuing operations (16 ) (776 ) 3,320
13
2,541
Cash used for investing activities - discontinued operations —
—
(19 ) —
(19 )
CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES (16 ) (776 ) 3,301
13
2,522

CASH FLOWS FROM FINANCING ACTIVITIES
Share repurchase (1,888 ) —
—
—
(1,888 )
Advances from (to) affiliates 2,722
1,304
(4,274 ) 248
—
Issuance of shares for employee benefit plans (118 ) —
—
—
(118 )
Issuance of debt 544
1,100
7
—
1,651
Repayment of debt (835 ) (1,150 ) (13 ) —
(1,998 )
Cash dividends to shareholders (274 ) —
—
—
(274 )
Noncontrolling interests and other financing activities —
—
(21 ) —
(21 )
Cash provided by (used for) financing activities - continuing operations 151
1,254
(4,301 ) 248
(2,648 )
Cash used for financing activities - discontinued operations —
—
—
—
—
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES 151
1,254
(4,301 ) 248
(2,648 )

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS —
—
91
—
91
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS —
1,477
142
(1,301 ) 318
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR ⁽¹⁾
—
1,633
660
(1,862 ) 431
CASH AND CASH EQUIVALENTS AT END OF PERIOD ⁽²⁾
$ —
$ 3,110
$ 802
$ (3,163 ) $ 749



	Three Months Ended March 31, 2019
(millions)	Aon plc			Aon Corporation			Other Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Cash flows from operating activities
Cash provided by (used for) operating activities	$	(11	)	$	(34	)	$	179		$	(60	)	$	74

Cash flows from investing activities
Proceeds from investments	—			8			4			—			12
Payments for investments	—			(9		)	(5		)	—			(14		)
Net sales of short-term investments - non-fiduciary	—			9			32			—			41
Acquisition of businesses, net of cash acquired	—			—			(15		)	—			(15		)
Sale of businesses, net of cash sold	—			—			6			—			6
Capital expenditures	—			—			(57		)	—			(57		)
Cash provided by (used for) investing activities	—			8			(35		)	—			(27		)

Cash flows from financing activities
Share repurchase	(100		)	—			—			—			(100		)
Advances from (to) affiliates	305			(265		)	(172		)	132			—
Issuance of shares for employee benefit plans	(98		)	—			—			—			(98		)
Issuance of debt	384			485			2			—			871
Repayment of debt	(384		)	(310		)	—			—			(694		)
Cash dividends to shareholders	(96		)	—			—			—			(96		)
Noncontrolling interests and other financing activities	—			—			(23		)	—			(23		)
Cash provided by (used for) financing activities	11			(90		)	(193		)	132			(140		)

Effect of exchange rate changes on cash and cash equivalents	—			—			37			—			37
Net increase (decrease) in cash and cash equivalents	—			(116		)	(12		)	72			(56		)
Cash and cash equivalents at beginning of period	—			862			575			(781		)	656
Cash and cash equivalents at end of period	$	—		$	746		$	563		$	(709	)	$	600


~~(1)~~	~~Includes $5 million of discontinued operations at December 31, 2016.~~


~~(2)~~	~~There was no cash held by discontinued operations at~~ ~~September 30, 2017~~.

Condensed Consolidating Statement of Cash Flows



	Three Months Ended March 31, 2018
(millions)	Aon plc			Aon Corporation			Other Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Cash flows from operating activities
Cash provided by (used for) operating activities	$	(21	)	$	626		$	277		$	(742	)	$	140

Cash flows from investing activities
Proceeds from investments	—			10			7			—			17
Payments for investments	(1		)	(5		)	(6		)	1			(11		)
Net sales of short-term investments - non-fiduciary	—			355			60			—			415
Acquisition of businesses, net of cash acquired	—			—			(29		)	—			(29		)
Sale of businesses, net of cash sold	—			—			(1		)	—			(1		)
Capital expenditures	—			—			(45		)	—			(45		)
Cash provided by (used for) investing activities	(1		)	360			(14		)	1			346

Cash flows from financing activities
Share repurchase	(569		)	—			—			—			(569		)
Advances from (to) affiliates	418			(933		)	(142		)	657			—
Issuance of shares for employee benefit plans	(109		)	—			—			—			(109		)
Issuance of debt	431			375			2			—			808
Repayment of debt	(61		)	(349		)	(294		)	—			(704		)
Cash dividends to shareholders	(89		)	—			—			—			(89		)
Noncontrolling interests and other financing activities	—			—			—			—			—
Cash provided by (used for) financing activities	21			(907		)	(434		)	657			(663		)

Effect of exchange rate changes on cash and cash equivalents	—			—			18			—			18
Net increase (decrease) in cash and cash equivalents	(1		)	79			(153		)	(84		)	(159		)
Cash and cash equivalents at beginning of period	1			2,524			793			(2,562		)	756
Cash and cash equivalents at end of period	$	—		$	2,603		$	640		$	(2,646	)	$	597

20. Lease Commitments

The Company leases office facilities, equipment, and automobiles under non-cancelable operating and finance leases. The Company’s lease obligations are primarily for the use of office space. The Company evaluates if a leasing arrangement exists upon inception of a contract. A contract contains a lease if the contract conveys the right to control the use of identified property, plant, or equipment for a period of time in exchange for consideration. Identified property, plant, or equipment may include a physically distinct portion of a larger asset, or a portion of an asset that represents substantially all of the capacity of the asset but is not physically distinct. In addition, the Company assesses whether a contract implicitly contains the right to control the use of a tangible asset that is not already owned. In addition, the Company subleases certain real estate properties to third parties, which consist of operating leases.

The Company’s leases expire at various dates and may contain renewal and expansion options. The Company’s leases do not typically contain termination options. The exercise of lease renewal and expansion options are at the Company’s sole discretion and are only included in the determination of the lease term if the Company is reasonably certain to exercise the option. The Company’s lease agreements typically do not contain any material residual value guarantees or restrictive covenants.

ROU assets and lease liabilities are based on the present value of the minimum lease payments over the lease term. As stated in Note 2 “Accounting Principles and Practices”, the Company has elected the practical expedient related to lease and non-lease components, as an accounting policy election for all asset classes, which allows a lessee to not separate non-lease from lease components and instead account for consideration received in a contract as a single lease component.

A portion of the Company’s lease agreements include variable lease payments which are not recorded in the initial measurement of the lease liability and ROU asset balances. For real estate arrangements, base rental payments may be escalated according to annual changes in the Consumer Price Index (“CPI”). The escalated rental payments based on the estimated CPI at the lease commencement date are included within minimum rental payments; however, changes in CPI are considered variable in nature and are recognized as variable lease costs in the period in which the obligation is incurred. Additionally, real estate lease agreements may include other variable payments related to operating expenses charged by the landlord based on actual expenditures. Information technology equipment agreements may include variable payments based on usage of the equipment.

The Company utilizes discount rates to determine the present value of the lease payments based on information available at the commencement date of the lease. The Company uses an incremental borrowing rate based on factors such as the lease term and the economic environment the lease exists to determine the appropriate present value of future lease payments as the rate implicit in the lease is not always readily available. When determining the incremental borrowing rate, the Company considers the rate of interest it would pay on a secured borrowing in an amount equal to the lease payments for the underlying asset under similar terms.

Operating leases are included in Operating lease right-of-use assets, Other current liabilities, and Non-current operating lease liabilities on the Condensed Consolidated Statements of Financial Position. Finance leases are included in Other non-current assets, Other current liabilities, and Other non-current liabilities on the Condensed Consolidated Statements of Financial Position.

The classification of operating and finance lease asset and liability balances within the Condensed Consolidated Statements of Financial Position is as follows (in millions):



As of		March 31, 2019
Assets
Operating lease assets	Operating lease right-of-use assets	$	993
Finance lease assets	Other non-current assets	70
Total lease assets		$	1,063

Liabilities
Current lease liabilities
Operating	Other current liabilities	$	214
Finance	Other current liabilities	27
Non-current lease liabilities
Operating	Non-current operating lease liabilities	978
Finance	Other non-current liabilities	50
Total lease liabilities		$	1,269

The components of lease costs are as follows (in millions):

Nine months ended September 30, 2016
Other
Aon Aon Non-Guarantor Consolidating
(millions) plc Corporation Subsidiaries Adjustments Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES

Cash provided by (used for) operating activities - continuing operations $ 219
$ (664 ) $ 1,597
$ —
$ 1,152
Cash provided by operating activities - discontinued operations —
—
323
—
323
CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES 219
(664 ) 1,920
—
1,475

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from investments —
19
12
—
31
Payments for investments —
(25 ) (22 ) —
(47 )
Net sales of short-term investments - non-fiduciary —
(99 ) (9 ) —
(108 )
Acquisition of businesses, net of cash acquired —
—
(198 ) —
(198 )
Sale of businesses, net of cash sold —
—
104
—
104
Capital expenditures —
—
(107 ) —
(107 )
Cash provided by (used for) investing activities - continuing operations —
(105 ) (220 ) —
(325 )
Cash used for investing activities - discontinued operations —
—
(46 ) —
(46 )
CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES —
(105 ) (266 ) —
(371 )

CASH FLOWS FROM FINANCING ACTIVITIES
Share repurchase (1,037 ) —
—
—
(1,037 )
Advances from (to) affiliates 166
356
(670 ) 148
—
Issuance of shares for employee benefit plans (70 ) —
—
—
(70 )
Issuance of debt 1,588
1,141
—
—
2,729
Repayment of debt (608 ) (1,692 ) (8 ) —
(2,308 )
Cash dividends to shareholders (258 ) —
—
—
(258 )
Noncontrolling interests and other financing activities —
—
(71 ) —
(71 )
Cash provided by (used for) financing activities - continuing operations (219 ) (195 ) (749 ) 148
(1,015 )
Cash used for financing activities - discontinued operations —
—
—
—
—
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES (219 ) (195 ) (749 ) 148
(1,015 )

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS —
—
10
—
10
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS —
(964 ) 915
148
99
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR(1) —
2,083
1,242
(2,941 ) 384
CASH AND CASH EQUIVALENTS AT END OF PERIOD(2) $ —
$ 1,119
$ 2,157
$ (2,793 ) $ 483



	Three Months Ended March 31, 2019
Operating lease cost	$	68
Finance lease cost
Amortization of leased assets	7
Interest on lease liabilities	1
Variable lease cost	6
Short-term lease cost ⁽¹⁾	1
Sublease income	(8		)
Net lease cost	$	75

(1) Short-term lease cost does not include expenses related to leases with a lease term of one month or less.

Maturity analysis of operating and financing leases as of March 31, 2019 are as follows (in millions):



	Operating			Finance			Less:
	Leases			Leases			Subleases			Total
Remainder of 2019	$	206		$	26		$	(26	)	$	206
2020	244			27			(31		)	240
2021	217			23			(31		)	209
2022	192			2			(32		)	162
2023	138			—			(14		)	124
Thereafter	494			—			(4		)	490
Total undiscounted future minimum lease payments	$	1,491		$	78		$	(138	)	$	1,431
Less: Imputed interest	(161		)	(1		)	—			(162		)
Present value of lease liabilities	$	1,330		$	77		$	(138	)	$	1,269

Weighted average remaining lease term and discount rate related to operating and finance leases are as follows:



~~(1)~~As of	~~Includes $2 million of discontinued operations at December~~ March 31, ~~2015.~~

	2019
~~(2)~~Weighted average remaining lease term (years)	~~Includes $3 million of discontinued operations at September 30, 2016.~~
Operating leases	8.0
Finance leases	2.7
Weighted average discount rate
Operating leases	3.3	%
Finance leases	2.5	%

Other cash and non-cash related activities are as follows (in millions):



	Three Months Ended March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	52
ROU assets obtained in exchange for new operating lease liabilities	$	26

Item 2. Management’s Discussion and Analysis of Financial Condition and Results ofOperations

EXECUTIVE SUMMARY OF ~~THIRD~~FIRST QUARTER ~~2017~~2019 FINANCIAL RESULTS

Aon plc (“Aon”, the “Company”, “we”, or “our”) is a leading global professional services firm providing a broad range of risk, retirement, and health solutions underpinned by proprietary data and analytics. Management is leading a set of initiatives designed to strengthen Aon and unite the firm with one portfolio of capability enabled by proprietary data and analytics and one operating model to deliver additional insight, connectivity, and efficiency. The divestiture of the benefits administration and business process outsourcing platform in Q2 2017 represents the next step of our strategy, which is consistent with our journey towards offering advice and solutions, and further aligning Aon’s portfolio around clients’ highest priorities. Further, it reinforces our ROIC decision-making process and emphasis on operating cash flow.

~~Discontinued Operations~~

On February 9, 2017, the Company entered into a Purchase Agreement with Tempo Acquisition, LLC to sell its benefits administration and business process outsourcing business to the Buyer, an entity formed and controlled by affiliates of The Blackstone Group L.P., and certain designated purchasers that are direct or indirect subsidiaries of the Buyer.

On May 1, 2017, the Buyer purchased all of the outstanding equity interests in each of the Divested Business’ subsidiaries, plus certain related assets and liabilities, for a purchase price of $4.3 billion in cash paid at closing, subject to customary adjustments set forth in the Purchase Agreement, and deferred consideration of up to $500 million. Cash proceeds after customary adjustments and before taxes due were $4.2 billion.

In the nine months ended September 30, 2017, the Company recorded a gain on sale, net of taxes, of $803 million and a non-cash impairment charge to its tradenames associated with the Divested Business of $380 million as these assets were not sold to the Buyer. Additionally, effective May 1, 2017, consistent with operating as one segment, the Company has implemented a three-year strategy to transition to a unified Aon brand. As a result, Aon commenced amortization of all indefinite lived tradenames and prospectively accelerated amortization of its finite lived tradenames over the three-year period. The accelerated amortization and impairment charge are included in Amortization and impairment of intangible assets on the Condensed Consolidated Statement of Income.

~~Business Overview~~

Beginning in the first quarter of 2017, following the classification of the Divested Business as a discontinued operation, the Company began operating as one segment that includes all of Aon’s continuing operations, which provides advice and solutions to clients focused on risk, retirement, and health through five principal products and service revenue lines: Commercial Risk Solutions, Reinsurance Solutions, Retirement Solutions, Health Solutions, and Data & Analytic Services.

~~Commercial Risk Solutions~~

Commercial Risk Solutions includes retail brokerage, cyber solutions, global risk consulting, and captives. In retail brokerage, our team of expert risk advisors applies a client-focused approach to commercial risk products and services that leverage Aon’s global network of resources, industry-leading data and analytics, and specialized expertise. Cyber solutions is one of the industry’s premier resources in cyber risk management. Our strategic focus extends to identify and protect critical digital assets supported by best-in-class transactional capabilities, enhanced coverage expertise, deep carrier relationships, and incident response expertise. Global risk consulting is a world leading provider of risk consulting services supporting clients to better understand and manage their risk profile through identifying and quantifying the risks they face. We assist clients with the selection and implementation of the appropriate risk transfer, risk retention, and risk mitigation solutions, and ensure the continuity of their operations through claims consulting. Captives is a leading global captive insurance solutions provider that manages over 1,100 insurance entities worldwide including captives, protected segregated and incorporated cell facilities, as well as entities that support Insurance Link Securities and specialist insurance and reinsurance companies.

~~Reinsurance Solutions~~

Reinsurance Solutions includes treaty and facultative reinsurance brokerage and capital markets. Treaty reinsurance brokerage addresses underwriting and capital objectives on a portfolio level, allowing our clients to more effectively manage the combination of premium growth, return on capital and rating agency interests. This includes the development of more competitive, innovative and efficient risk transfer options. Facultative reinsurance brokerage empowers clients to better understand, manage and transfer risk through innovative facultative solutions and provides the most efficient access to the global facultative markets. Capital markets is a global investment bank with expertise in M&A, capital raising, strategic advice, restructuring, recapitalization services, and insurance-linked securities. We work with insurers, reinsurers, investment firms, banks, and corporations to manage complex commercial issues through the provision of corporate finance advisory services, capital markets solutions, and innovative risk management products.

~~Retirement Solutions~~

Retirement Solutions includes core retirement, investment consulting, and talent, rewards & performance. Retirement consulting specializes in providing organizations across the globe with strategic design consulting on their retirement programs, actuarial services, and risk management, including pension de-risking, governance, integrated pension administration. and legal and compliance consulting. Investment consulting provides public and private companies and other institutions with advice on developing and maintaining investment programs across a broad range of plan types; including defined benefit plans, defined contribution plans, endowments and foundations. Our delegated investment solutions offer ongoing management of investment programs and fiduciary responsibilities either in a partial or full discretionary model for multiple asset owners. It partners with clients to deliver our scale and experience to help them effectively manage their investments, risk, and governance and potentially lower costs. Talent, rewards & performance delivers advice and solutions that help clients accelerate business outcomes by improving the performance of their people. It supports the full employee lifecycle from assessment and selection of the right talent, optimized deployment and engagement to the design, alignment and benchmarking of compensation to business strategy and performance outcomes.

~~Health Solutions~~

Health Solutions includes health and benefits brokerage and healthcare exchanges. Health and benefits brokerage partners with employers to develop innovative, customized benefits strategies that help manage risk, drive engagement, and promote accountability. Our private health exchange solutions help employers transform how they sponsor, structure, and deliver health benefits by building and operating a cost effective alternative to traditional employee and retiree healthcare. We seek outcomes of reduced employer costs, risk and volatility, alongside greater coverage and plan choices for individual participants.

~~Data & Analytic Services~~

Data & Analytic Services includes Affinity, Aon InPoint, and ReView. Affinity specializes in developing, marketing and administering customized insurance programs and specialty market solutions for affinity organizations and their members or affiliates. Aon InPoint draws on Aon’s proprietary database (Global Risk Insight Platform) and is dedicated to making insurers more competitive through providing data, analytics, engagement and consulting. ReView draws on Aon’s proprietary database and broker market knowledge to provide advisory services analysis and benchmarking to help reinsurers more effectively meet the needs of cedents through the development of more competitive, innovative and efficient risk transfer options.

Financial Results

The following is a summary of our ~~third~~first quarter ~~and first nine months~~ of ~~2017~~2019 financial results from continuing operations:

For the ~~third~~first quarter of ~~2017,~~2019, revenue increased 6%2%, or ~~$139~~$53 million, to ~~$2.3~~$3.1 billion compared to the prior year period due primarily to a 3% increase related to acquisitions, net of divestitures, organic revenue growth of 2%, and a 1% favorable impact from foreign currency exchange rates. For the first nine months ended September 30, 2017, revenue increased 5% compared to the prior year period due primarily to organic revenue growth of ~~3% and a 3% increase related to acquisitions, net of divestitures,~~6%, partially offset by a 1%4% unfavorable impact from translating prior year period results at current period foreign exchange rates (“foreign currency ~~exchange rates.~~translation”).

Operating expenses for the ~~third~~first quarter of ~~2017~~2019 were ~~$2.1~~$2.3 billion, ~~an increase~~a decrease of ~~$242~~$20 million compared to the prior year period. The ~~increase~~decrease was due primarily to ~~$102~~a $93 million of restructuring costs, a $62 million increase in operating expenses related to acquisitions, net of divestitures, $54 million of accelerated amortization related to tradenames, a $16 million unfavorablefavorable impact from foreign currency translation, ~~$10~~$45 million of transaction related costs associated with recent acquisitions, and an increase in expense associated with 2% organic revenue growth, partially offset by $55 million of savings related to restructuring and other operational improvement initiatives. Operating expenses for the first nine months of 2017 increased $1,015 million compared to the prior year period primarily due to $401 million of restructuring costs, a $380 million non-cash impairment charge to the tradenames associated with the Divested Business, a $183 million

increase in operating expenses related to acquisitions, net of divestitures, $89 million of accelerated amortization related to tradenames to move to the one Aon United brand, $42 million of costs related to regulatory and compliance matters, and an increase in expense associated with organic revenue growth of 3%, partially offset by $109 million ofincremental savings related to restructuring and other operational improvement initiatives, and a ~~$76~~$21 million ~~favorable impact from foreign currency exchange rates, and $62 million of expense~~decrease in expenses related to ~~certain non-cash pension settlements~~divestitures, net of acquisitions, partially offset by a $17 million increase in ~~the prior year period.~~restructuring charges and an increase in expenses associated with 6% organic revenue growth.

Operating margin ~~decreased~~increased to ~~11.3%~~27.7% in the ~~third~~first quarter of ~~2017~~2019 from ~~16.7%~~25.9% in the prior year period. The ~~decrease~~underlying increase was driven ~~by an increase in expense due to the factors listed above, partially offset~~ by organic revenue growth of ~~2%. The decrease from the prior year period~~6% and ~~first nine months of 2017 was driven by an increase in expense due to the factors listed above, partially offset by organic revenue growth of 3%.~~operational improvement.

Due to the factors set forth above, net income from continuing operations ~~decreased $88~~increased $72 million, or ~~31%~~12%, to ~~$196~~$676 million for the ~~third~~first quarter of ~~2017~~2019 compared to the prior year period. ~~During the first nine months of 2017, income~~

Diluted earnings per share from continuing operations ~~decreased $451 million, or 52%, to $418 million~~was $2.70 per share for the first quarter of 2019 compared to $2.35 per share for the ~~first nine months of 2016.~~prior year period.

Cash flow provided by operating activities was ~~$289~~$74 million for the first ~~nine~~three months of ~~2017,~~2019, a decrease of ~~$863~~$66 million from ~~$1,152 million in~~ the prior year period. ~~The decrease was driven primarily~~Strong operational improvement and working capital improvements in payables were more than offset by ~~cash tax payments associated with the Divested Business and $199~~approximately $85 million of net cash payments related to legacy litigation and $15 million of incremental cash restructuring ~~payments, partially offset by operational improvement.~~charges.

We focus on four key non-GAAP metrics that we communicate to shareholders: organic revenue growth, adjusted operating margin, adjusted diluted earnings per share, and free cash flow. These non-GAAP metrics should be viewed in addition to, not instead of, our ~~Condensed Consolidated~~ Financial ~~Statements and Notes thereto.~~Statements. The following is our measure of performance against these four metrics from continuing operations for the ~~third~~first quarter of ~~2017:~~2019:

Organic revenue growth, a non-GAAP measure defined under the caption “Review of Consolidated Results — Organic Revenue Growth,” was 2%6% for the ~~third~~first quarter of ~~2017,~~2019, compared to ~~4% organic growth~~3% in the prior year period. Organic revenue growth ~~was 3%~~ for the ~~first nine months of 2017, compared to 3%~~quarter was driven by growth across every major revenue line, with particular strength in ~~the prior year period.~~Reinsurance Solutions and Commercial Risk Solutions.

Adjusted operating margin, a non-GAAP measure defined under the caption “Review of Consolidated Results — Adjusted Operating Margin,” was ~~20.3%~~33.7% for the ~~third~~first quarter of ~~2017~~2019 compared to ~~18.6% for the prior year period. For the first nine months of 2017, adjusted operating margin was 21.7% as compared to 20.0% for~~31.8% in the prior year period. The ~~increases~~increase in adjusted operating margin primarily ~~reflect restructuring savings,~~reflects organic revenue growth ~~and underlying~~of 6%, core operational improvement, ~~partially offset by expenses~~and savings related to ~~reinvestment.~~restructuring and other operational improvement initiatives.

Adjusted diluted earnings per share from continuing operations, a non-GAAP measure defined under the caption “Review of Consolidated Results — Adjusted Diluted Earnings per Share,” was ~~$1.29~~$3.31 per share for the ~~third~~first quarter of ~~2017 and $4.19 in the first nine months of 2017,~~2019, compared to ~~$1.09 per share and $3.59~~$2.97 per share for the respective prior year ~~periods.~~period.

Free cash flow, a non-GAAP measure defined under the caption “Review of Consolidated Results — Free Cash Flow,” decreased in the first ~~nine~~three months of ~~2017~~2019 by ~~$881~~$78 million, or ~~84%~~82%, from the prior year period, to ~~$164~~$17 million, driven by a decrease of ~~$863~~$66 million in cash flow from operations and ana $12 million increase ~~of $18 million~~ in capital expenditures, including investments in our operating model.

REVIEW OF CONSOLIDATED RESULTS

Summary of Results

Our consolidated results are as ~~follow:~~follow (in millions):


	Three Months Ended						Nine Months Ended						Three Months Ended
(millions)	September 30, 2017			September 30, 2016			September 30, 2017			September 30, 2016
													March 31, 2019			March 31, 2018
Revenue
Total revenue	$	2,340		$	2,201		$	7,089		$	6,759		$	3,143		$	3,090
Expenses
Compensation and benefits	1,419			1,300			4,337			4,041			1,584			1,616
Information technology	109			99			295			281			117			115
Premises	89			86			259			257			87			93
Depreciation of fixed assets	40			39			148			118			40			39
Amortization and impairment of intangible assets	101			42			604			117			97			110
Other general expenses	317			267			956			770			346			318
Total operating expenses	2,075			1,833			6,599			5,584			2,271			2,291
Operating income	265			368			490			1,175			872			799
Interest income	10			1			20			6			2			4
Interest expense	(70		)	(70		)	(211		)	(212		)	(72		)	(70		)
Other income (expense)	(5		)	10			(20		)	27			—			(15		)
Income from continuing operations before income taxes	200			309			279			996			802			718
Income tax expense (benefit)	4			25			(139		)	127
Income taxes													126			114
Net income from continuing operations	196			284			418			869			676			604
Income from discontinued operations, net of tax	(4		)	42			857			102
Net income from discontinued operations													—			6
Net income	192			326			1,275			971			676			610
Less: Net income attributable to noncontrolling interests	7			7			30			27			17			16
Net income attributable to Aon shareholders	$	185		$	319		$	1,245		$	944		$	659		$	594
Diluted net income per share attributable to Aon shareholders
Continuing operations													$	2.70		$	2.35
Discontinued operations													—			0.02
Net income													$	2.70		$	2.37
Weighted average ordinary shares outstanding - diluted													243.7			250.2

Revenue

Total revenue increased by 6%2%, or ~~$139~~$53 million, in the ~~third~~first quarter of ~~2017~~2019 compared to the ~~third~~first quarter of ~~2016.~~2018. This change reflects ~~a 3% increase related to acquisitions, net of divestitures, 2%~~ organic revenue growth ~~and a 1% favorable impact from foreign currency exchange rates. For the first nine months~~ of ~~2017, total revenue increased 5%~~6%, ~~or $330 million, compared to the prior year period. This change reflects 3% organic growth and a 3% increase related to acquisitions, net of divestitures,~~ partially offset by a 1%4% unfavorable impact from foreign currency ~~exchange rates.~~translation.

Commercial Risk Solutions ~~organic~~ revenue ~~growth was (1)%~~decreased $66 million, or 6%, to $1,118 million in the ~~third~~first quarter of ~~2017 driven by amodest decline across~~2019, compared to $1,184 million in the ~~Americas, particularly in U.S. retail and Latin America due to certain unfavorable timing, partially offset by solid growth across the EMEA and Pacific regions.~~first quarter of 2018. Organic revenue growth was 1%6% in the first ~~nine months of 2017 compared to the prior year period driven by solid growth across the U.S., EMEA, and Pacific regions, partially offset by a decline in Latin America.~~

~~Reinsurance Solutions~~ ~~organic revenue growth was 7% in the third~~ quarter of 2017 and 5% in the first nine months of 2017 compared to the respective prior year periods driven by strong growth in capital markets, as well as growth in facultative placements and net new business generation in treaty, partially offset by an unfavorable market impact globally.

~~Retirement Solutions~~ organic revenue growth was 5% in the third quarter of 2017 compared to the third quarter of 2016 driven by strong growth in investment consulting, primarily for delegated investment management, as well as growth in our talent practice, primarily for compensation surveys and benchmarking services. Organic revenue growth was 3% in the first nine months of 20172019 compared to the prior year period, driven by growth across every major geography, highlighted by double-digit growth in ~~investment consulting, primarily for delegated investment management.~~

~~Health Solutions~~ ~~organic revenue~~Latin America and strong growth across North America and Asia. Results reflect strong global new business generation and management of the renewal book portfolio. In North America, double-digit new business generation was 2%highlighted by strength in our transaction liability business in the ~~third~~U.S.

Reinsurance Solutions revenue increased $46 million, or 6%, to $788 million in the first quarter of ~~2017~~2019, compared to $742 million in the ~~third~~first quarter of ~~2016 driven by solid growth in health & benefits brokerage, particularly in the U.S. and Latin America, partially offset by a decline in project~~

~~related work in the healthcare exchange business.~~2018. Organic revenue growth was ~~7% for~~9% in the first ~~nine months~~quarter of ~~2017~~2019 compared to the prior year period, driven by strong net new business generation globally in treaty, as well as double-digit growth globally in facultative placements and in capital markets transactions. In addition, market impact was modestly positive on results in the first quarter.

Retirement Solutions revenue decreased $4 million, or 1%, to $420 million in the first quarter of 2019, compared to $424 million in the first quarter of 2018. Organic revenue growth was 2% in the first quarter of 2019 compared to the prior year period,

driven by solid growth in investment consulting, including double-digit growth in delegated investment management. Results also reflect modest growth in our actuarial retirement businesses globally, and growth across Performance, Rewards, and Assessment.

Health Solutions revenue increased $35 million, or 8%, to $486 million in the first quarter of 2019, compared to $451 million in the first quarter of 2018. Organic revenue growth was 5% in the first quarter of 2019 driven by solid growth globally in health &and benefits ~~brokerage.~~brokerage, highlighted by particular strength internationally, including double-digit growth in China.

Data & Analytic Services ~~organic~~ revenue increased $42 million, or 14%, to $336 million in the first quarter of 2019, compared to $294 million in the first quarter of 2018. Organic revenue growth was 3%5% in the ~~third~~first quarter ~~and 4% for first nine months~~ of ~~2017~~2019 compared to the ~~respective~~ prior year ~~periods~~period, driven by ~~strong~~ growth ~~in the~~globally across our Affinity business, with particular strength across both business and consumer solutions in the U.S. and EMEA.

Compensation and Benefits

Compensation and benefits ~~increased $119~~decreased $32 million, or 9%2%, in the ~~third~~first quarter of ~~2017~~2019 compared to the ~~third~~first quarter of ~~2016.~~2018. This ~~increase~~decrease was primarily driven by ~~$52~~a $69 million ~~of restructuring costs, a $37 million increase in expenses from businesses acquired, net of divestitures, a $14 million unfavorable~~favorable impact from foreign currency translation $2and $48 million of transaction related costs associated with recent acquisitions, and an increase in expense associated with 2% organic revenue growth, partially offset by $32 million of savings related to restructuring and other operational improvement initiatives. For the first nine months of 2017, compensation and benefits increased $296 million, or 7%, compared to the first nine months of 2016. The increase was primarily driven by $257 million of restructuring costs, a $110 million increase in expenses related to acquisitions, net of divestitures, and an increase in expense associated with 3% organic revenue growth, partially offset by $62 million of expense related to certain non-cash pension settlements in the prior year period, $62 million ofincremental savings related to restructuring and other operational improvement initiatives, ~~and a $53 million favorable impact from foreign currency translation.~~partially offset by an increase in expense associated with 6% organic revenue growth.

Information Technology

Information technology, which represents costs associated with supporting and maintaining our infrastructure, increased ~~$10~~$2 million, or ~~10%~~2%, in the ~~third~~first quarter of ~~2017~~2019 compared to the ~~third~~first quarter of ~~2016.~~2018. This increase was primarily driven by ~~$12 million of restructuring costs, as well as~~an increase in investments supporting growth initiatives and an increase in growth, partially offset by $13 million of savings related to restructuring and other operational improvement initiatives. For the first nine months of 2017, information technology increased $14 million, or 5%, compared to the prior year period. This increase was primarily driven by $22 million of restructuring charges and investments in growth, partially offset by $29 million of savings related to restructuring and other operational improvement initiatives.expense associated with 6% organic revenue growth.

Premises

Premises, which represents the cost of occupying offices in various locations throughout the world, ~~increased $3~~decreased $6 million, or 3%6%, in the ~~third~~first quarter of ~~2017~~2019 compared to the ~~third~~first quarter of ~~2016.~~2018. This ~~increase~~decrease was primarily driven by $4$5 million of restructuring costs, partially offset by $1 million of savings related to restructuring and other operational improvement initiatives. For the first nine months of 2017, premises increased $2 million, or 1%, compared to the first nine months of 2016. This increase was primarily driven by a $9 million increase in expenses related to acquisitions, net of divestitures and $8 million of restructuring costs, partially offset by $2 million ofincremental savings related to restructuring and other operational improvement initiatives and a ~~decrease~~$4 million favorable impact from foreign currency translation, partially offset by a $7 million increase in ~~expense as we optimize our real estate footprint.~~restructuring costs.

Depreciation of Fixed Assets

Depreciation of fixed assets primarily relates to software, leasehold improvements, furniture, fixtures and equipment, computer equipment, buildings, and automobiles. Depreciation of fixed assets increased $1 million, or 3%, in the ~~third~~first quarter of 2017 compared to the third quarter of 2016. This increase was primarily driven by $2 million of restructuring costs. For the first nine months of 2017, depreciation of fixed assets increased $30 million, or 25%,2019 compared to the first ~~nine months~~quarter of ~~2016. This increase was primarily driven by $26 million of restructuring costs and a $12 million increase in expenses related to acquisitions, net of divestitures.~~2018.

Amortization and Impairment of Intangibles Assets

Amortization and impairment of intangibles primarily relates to finite-lived tradenames and customer-related, contract-based, and technology assets. Amortization and impairment of intangibles ~~increased $59~~decreased $13 million, or ~~140%~~12%, in the ~~third~~first quarter of 2017 compared to the third quarter of 2016 due to $54 million of accelerated amortization related to tradenames. For the first nine months of 2017, amortization and impairment of intangibles increased $487 million, or 416%,2019 compared to the first ~~nine months~~quarter of ~~2016~~2018 due to a ~~$380~~$6 million ~~non-cash impairment charge to the tradenames associated with the sale of the Divested Business and $89 million of accelerated amortization~~decrease related to ~~tradenames.~~

divestitures, net of acquisitions, and a favorable impact from foreign currency translation.

Other General Expenses

Other general expenses in the ~~third~~first quarter of ~~2017~~2019 increased ~~$50~~$28 million, or ~~19%~~9%, compared to the ~~third~~first quarter of ~~2016. This increase was~~2018 due primarily to ~~$32~~a $19 million ofincrease in restructuring costs, a $17 million increase in operating expenses related to acquisitions, net of divestitures, $8 million of costs related to regulatory and compliance matters, and $8 million of transaction related costs associated to recent acquisitions, partially offset by $9 million of savings from restructuring and other operational improvement initiatives. For the first nine months of 2017, other general expenses increased $186 million, or 24%, compared to the prior year period. This increase was primarily driven by $88 million of restructuring costs, a $49 million increasedecrease in operating expenses related to acquisitions, net of divestitures, $42 million of costs related to regulatory and compliance matters, and an increase in expense associated with 3% organic revenue growth, partially offset by $16 million of savings related to restructuring and other operational improvement initiatives, and an increase in expense associated with 6% organic revenue growth, partially offset by a ~~$13~~$14 million favorable impact from foreign currency translation.

Interest Income

Interest income represents income earned on operating cash balances and other income-producing investments. It does not include interest earned on funds held on behalf of clients. During the ~~third~~first quarter of ~~2017,~~2019, Interest income was ~~$10~~$2 million, compared to $1$4 million during the prior year period. For the first nine months of 2017, Interest income was $20 million, compared to $6 million during the prior year period. The increase in both periods reflects additional income earned on the proceeds from the sale of the Divested Business.

Interest Expense

Interest expense, which represents the cost of our debt obligations, was ~~$70 million during the third quarter of 2017, similar to $70~~$72 million for the ~~prior year period. For~~three months ended March 31, 2019, an increase of $2 million, or 3%, from the first ~~nine months~~quarter of ~~2017, Interest expense was $211 million, a decrease from $212 million for the prior year period.~~2018.

Other Income (Expense)

~~Other expense~~Total other income (expense) was $5$0 million for the ~~third~~first quarter of ~~2017,~~2019, compared to other ~~income~~expense of ~~$10~~$15 million for the ~~third~~first quarter of ~~2016.~~2018. Other income for the first quarter of 2019 primarily includes $11 million of losses due to the unfavorable impact of exchange rates on the remeasurement of assets and liabilities in non-functional currencies, offset by a $5 million gain on sale of certain businesses, $4 million of pension and other postretirement income, $1 million of gains on financial instruments and $1 million of equity earnings. Other expense ~~for~~of $15 million in the ~~third~~first quarter of ~~2017~~2018 primarily includes ~~$20 million of~~ losses due to the unfavorable impact of exchange rates on the remeasurement of assets and liabilities in non-functional currencies, partially offset by ~~$16 million of gains on financial instruments. Other income of $10 million in the third quarter of 2016 primarily includes gains on certain long term investments.~~

~~Other expense was $20 million for the first nine months of 2017, compared to~~pension and other income of $27 million for the prior year period. Other expense for the first nine months of 2017 primarily includes $32 million of losses due to the unfavorable impact of exchange rates on the remeasurement of assets and liabilities in non-functional currencies, excluding hedging gains, partially offset by $6 million of gains on certain financial instruments. Other income of $27 million in the first nine months of 2016 primarily included $41 million of net gains on the sale of certain businesses, partially offset by a $14 million unfavorable impact of exchange rates on the remeasurement of assets and liabilities in non-functional currencies, excluding hedging losses.postretirement income.

Income From Continuing Operations before Income Taxes

Due to the factors discussed above, income from continuing operations before income taxes for the ~~third~~first quarter of ~~2017~~2019 was ~~$200~~$802 million, a ~~35% decrease~~12% increase from ~~$309 million in the third quarter of 2016, and $279 million for the first nine months of 2017, a 72% decrease from $996~~$718 million in the first ~~nine months~~quarter of ~~2016.~~2018.

Income Taxes From Continuing Operations

The effective tax ~~rate~~rates on net income from continuing operations ~~was 2.0%~~were 15.7% and ~~8.1%~~15.9% for the ~~third quarters~~first quarter of ~~2017~~2019 and ~~2016, respectively. The effective tax rate on net income from continuing operations was (49.8)% and 12.8% for the nine months ended September 30, 2017 and 2016,~~2018, respectively. For the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2019, the ~~Company reported a tax benefit of $139 million on pretax income of $279 million, which resulted in an effective~~ tax rate was primarily driven by the geographical distribution of ~~(49.8)%. The primary components~~income and certain discrete items including the impact of ~~this~~share-based payments. For the three months ended March 31, 2018, the tax ~~amount were~~rate was primarily driven by the ~~non-cash tax benefit from the tradename impairment associated with the Divested Business~~geographical distribution of income and certain discrete items including the impact of share-based payments ~~from adoption~~and the recognition of previously unrecognized tax benefits related to the ~~new share-based compensation guidance.~~statute of limitations expiration following an audit.

Net Income from Discontinued Operations

Net ~~of Tax~~

On February 9, 2017, the Company entered into the Purchase Agreement with Tempo Acquisition, LLC to sell the Divested Business. The Company has retrospectively classified the results of the Divested Business as discontinued operations in the Company’s Condensed Consolidated Statements of Income for all periods presented. Incomeincome from discontinued operations was $0 million, compared to net income of ~~tax, decreased $46~~$6 million in the ~~third quarter of 2017 as compared~~prior year period, due to the ~~prior year period. The decrease was primarily driven by run off~~run-off of expenses ~~associated with the Divested Business. Income from discontinued operations, net of tax, increased $755 million in the first nine months of 2017 as compared~~related to ~~the prior year period. The increase is primarily driven by a $803 million gain on sale of~~ the Divested Business.

Net Income Attributable to Aon Shareholders

Net income attributable to Aon shareholders for the ~~three months ended September 30, 2017 decreased~~first quarter of 2019 increased to ~~$185~~$659 million, or ~~$0.72~~$2.70 per diluted share, from ~~$319~~$594 million, or ~~$1.18~~$2.37 per diluted share, in the prior year period. Net income attributable to Aon shareholders for the first nine months of 2017 increased to $1,245 million, or $4.74 per diluted share, from $944 million, or $3.48 per diluted share, in the prior year period.

Non-GAAP Metrics

In our discussion of consolidated results, we sometimes refer to certain non-GAAP supplemental information derived from consolidated financial information specifically related to organic revenue growth, adjusted operating margin, adjusted diluted earnings per share, free cash flow, and the impact of foreign exchange rate fluctuations on operating results. This non-GAAP supplemental information should be viewed in addition to, not instead of, our ~~Condensed Consolidated~~ Financial ~~Statements and Notes thereto.~~Statements.

Organic Revenue Growth

We use supplemental information related to organic revenue growth to help us and our investors evaluate business growth from existing operations. Organic revenue growth is a non-GAAP measure that includes the impact of intercompany activity and excludes the impact of changes in foreign exchange ~~rate,~~rates, fiduciary investment income, acquisitions, divestitures, transfers between ~~subsidiaries, fiduciary investment income,~~revenue lines, and ~~reimbursable expenses.~~gains or losses on derivatives accounted for as hedges. This supplemental information related to organic revenue growth represents a measure not in accordance with U.S. GAAP and should be viewed in addition to, not instead of, our ~~Condensed Consolidated~~ Financial ~~Statements and Notes thereto.~~Statements. Industry peers provide similar supplemental information about their revenue performance, although they may not make identical adjustments. A reconciliation of this non-GAAP measure to the reported Total revenue is as follows (in millions, except percentages):

Three Months Ended
September 30, 2017 September 30, 2016 % Change
Less: Currency Impact ⁽¹⁾

Less: Fiduciary Investment Income ⁽²⁾
Less: Acquisitions, Divestitures & Other
Organic Revenue Growth ⁽³⁾
Revenue

Commercial Risk Solutions $ 917
$ 884
4 % 1 % — % 4 % (1 )%
Reinsurance Solutions 355
329
8
1
—
—
7
Retirement Solutions 491
466
5
1
—
(1 ) 5
Health Solutions 293
265
11
1
—
8
2
Data & Analytic Services 289
260
11
1
—
7
3
Elimination (5 ) (3 ) N/A
N/A
N/A
N/A
N/A
Total revenue $ 2,340
$ 2,201
6 % 1 % — % 3 % 2 %


	Nine Months Ended																Three Months Ended
	September 30, 2017			September 30, 2016			% Change		Less: Currency Impact ⁽¹⁾		Less: Fiduciary Investment Income ⁽²⁾		Less: Acquisitions, Divestitures & Other		Organic Revenue Growth ⁽³⁾		March 31, 2019			March 31, 2018			% Change		Less: Currency Impact ⁽¹⁾		Less: Fiduciary Investment Income ⁽²⁾		Less: Acquisitions, Divestitures & Other		Organic Revenue Growth ⁽³⁾
Revenue
Commercial Risk Solutions	$	2,943		$	2,835		4	%	(1	)%	—	%	4	%	1	%	$	1,118		$	1,184		(6	)%	(5	)%	—	%	(7	)%	6	%
Reinsurance Solutions	1,070			1,032			4		(1	)	—		—		5		788			742			6		(3	)	—		—		9
Retirement Solutions	1,266			1,266			—		(2	)	—		(1	)	3		420			424			(1	)	(4	)	—		1		2
Health Solutions	977			838			17		(1	)	—		11		7		486			451			8		(5	)	—		8		5
Data & Analytic Services	842			794			6		—		—		2		4		336			294			14		(4	)	—		13		5
Elimination	(9		)	(6		)	N/A		N/A		N/A		N/A		N/A		(5		)	(5		)	N/A		N/A		N/A		N/A		N/A
Total revenue	$	7,089		$	6,759		5	%	(1	)%	—	%	3	%	3	%	$	3,143		$	3,090		2	%	(4	)%	—	%	—	%	6	%


(1)	Currency impact is determined by translating prior period's revenue at this period's foreign exchange rates.


(2)	Fiduciary investment income for the three months ended ~~September 30, 2017~~March 31, 2019 and ~~2016,~~2018, respectively, was ~~$10~~$19 million and ~~$6 million. Fiduciary Investment Income for the nine months ended September 30, 2017 and 2016, respectively, was $23 million and $16~~$10 million.


(3)	Organic revenue growth includes the impact of intercompany activity and excludes the impact of changes in foreign exchange rates, fiduciary investment income, acquisitions, divestitures, transfers between ~~business units, fiduciary investment income,~~revenue lines, and ~~reimbursable expenses.~~gains or losses on derivatives accounted for as hedges.

Adjusted Operating Margin

We use adjusted operating margin as a non-GAAP measure of core operating performance of the Company. Adjusted operating margin excludes the impact of certain items, as listed below, because management does not believe these expenses reflect our core operating performance. This supplemental information related to adjusted operating margin represents a measure not in accordance with U.S. GAAP and should be viewed in addition to, not instead of, our ~~Condensed Consolidated~~ Financial ~~Statements and Notes thereto.~~Statements.

A reconciliation of this non-GAAP measure to the reported operating margin is as follows (in millions, except percentages):


	Three Months Ended						Nine Months Ended						Three Months Ended
	September 30, 2017			September 30, 2016			September 30, 2017			September 30, 2016			March 31, 2019			March 31, 2018
Revenue from continuing operations	$	2,340		$	2,201		$	7,089		$	6,759		$	3,143		$	3,090

Operating income from continuing operations - as reported	$	265		$	368		$	490		$	1,175		$	872		$	799
Amortization and impairment of intangible assets	101			42			604			117			97			110
Restructuring	102			—			401			—			91			74
Regulatory and compliance matters	8			—			42			—
Pension settlement	—			—			—			62
Operating income income from continuing operations - as adjusted	$	476		$	410		$	1,537		$	1,354
Operating income from continuing operations - as adjusted													$	1,060		$	983

Operating margin from continuing operations - as reported	11.3		%	16.7		%	6.9		%	17.4		%	27.7		%	25.9		%
Operating margin from continuing operations - as adjusted	20.3		%	18.6		%	21.7		%	20.0		%	33.7		%	31.8		%

Adjusted Diluted Earnings per Share

We use adjusted diluted earnings per share as a non-GAAP measure of our core operating performance. Adjusted diluted earnings per share excludes the items identified above, along with pension settlements and related income taxes, because management does not believe these expenses are representative of our core earnings. This supplemental information related to adjusted diluted earnings per share represents a measure not in accordance with U.S. GAAP and should be viewed in addition to, not instead of, our ~~Condensed Consolidated~~ Financial Statements and Notes thereto.

A reconciliation of this non-GAAP measure to the reported Diluted earnings per share is as ~~follows:~~follows (in millions, except per share data and percentages):


	Three Months Ended September 30, 2017									Three Months Ended March 31, 2019
(millions, except per share data)	U.S. GAAP			Adjustments			As Adjusted
															Non-GAAP
										U.S. GAAP			Adjustments		Adjusted
Operating income from continuing operations	$	265		$	211		$	476		$	872		$	188	$	1,060
Interest income	10			—			10			2			—		2
Interest expense	(70		)	—			(70		)	(72		)	—		(72		)
Other income (expense)	(5		)	—			(5		)	—			—		—
Income before income taxes from continuing operations	200			211			411			802			188		990
Income taxes ⁽¹⁾	4			68			72
Income taxes ⁽²⁾										126			41		167
Net income from continuing operations	196			143			339			676			147		823
Income from discontinued operations, net of tax ⁽²⁾	(4		)	(6		)	(10		)
Net income from discontinued operations ⁽³⁾										—			—		—
Net income	192			137			329			676			147		823
Less: Net income attributable to noncontrolling interests	7			—			7			17			—		17
Net income attributable to Aon shareholders	$	185		$	137		$	322		$	659		$	147	$	806

Diluted net income (loss) per share attributable to Aon shareholders
Continuing operations	$	0.73		0.56			$	1.29		$	2.70		$	0.61	$	3.31
Discontinued operations	(0.01		)	(0.03		)	(0.04		)	—			—		—
Net income	$	0.72		$	0.53		$	1.25		$	2.70		$	0.61	$	3.31

Weighted average ordinary shares outstanding - diluted	257.3			—			257.3			243.7			—		243.7
Effective Tax Rates ⁽³⁾
Continuing Operations - U.S. GAAP										15.7		%			16.9		%
Discontinued Operations - U.S. GAAP										—		%			—		%

Three Months Ended September 30, 2016
(millions, except per share data) U.S. GAAP Adjustments As Adjusted
Operating income from continuing operations $ 368
$ 42
$ 410
Interest income 1
—
1
Interest expense (70 ) —
(70 )
Other income (expense) 10
—
10
Income before income taxes from continuing operations 309
42
351
Income taxes ⁽¹⁾
25
25
50
Net income from continuing operations 284
17
301
Income from discontinued operations, net of tax ⁽²⁾
42
23
65
Net income 326
40
366
Less: Net income attributable to noncontrolling interests 7
—
7
Net income attributable to Aon shareholders $ 319
$ 40
$ 359

Diluted net income per share attributable to Aon shareholders

Continuing operations $ 1.03
0.06
$ 1.09
Discontinued operations 0.15
0.09
0.24
Net income $ 1.18
$ 0.15
$ 1.33

Weighted average ordinary shares outstanding - diluted 269.6
—
269.6

Nine Months Ended September 30, 2017
(millions, except per share data) U.S. GAAP Adjustments As Adjusted
Operating income from continuing operations $ 490
$ 1,047
$ 1,537
Interest income 20
—
20
Interest expense (211 ) —
(211 )
Other income (expense) (20 ) —
(20 )
Income before income taxes from continuing operations 279
1,047
1,326
Income taxes ⁽¹⁾
(139 ) 333
194
Net income from continuing operations 418
714
1,132
Income from discontinued operations, net of tax ⁽²⁾
857
(797 ) 60
Net income 1,275
(83 ) 1,192
Less: Net income attributable to noncontrolling interests 30
—
30
Net income attributable to Aon shareholders $ 1,245
$ (83 ) $ 1,162

Diluted net income per share attributable to Aon shareholders
Continuing operations $ 1.48
2.71
$ 4.19
Discontinued operations 3.26
(3.03 ) 0.23
Net income $ 4.74
$ (0.32 ) $ 4.42

Weighted average ordinary shares outstanding - diluted 262.9
—
262.9


	Nine Months Ended September 30, 2016								Three Months Ended March 31, 2018
(millions, except per share data)	U.S. GAAP			Adjustments		As Adjusted
															Non-GAAP
									U.S. GAAP			Adjustments			Adjusted
Operating income from continuing operations	$	1,175		$	179	$	1,354		$	799		$	184		$	983
Interest income	6			—		6			4			—			4
Interest expense	(212		)	—		(212		)	(70		)	—			(70		)
Other income (expense)	27			—		27
Other income (expense) ⁽¹⁾									(15		)	7			(8		)
Income before income taxes from continuing operations	996			179		1,175			718			191			909
Income taxes ⁽¹⁾	127			49		176
Income taxes ⁽²⁾									114			36			150
Net income from continuing operations	869			130		999			604			155			759
Income from discontinued operations, net of tax ⁽²⁾	102			69		171
Net income from discontinued operations ⁽³⁾									6			(8		)	(2		)
Net income	971			199		1,170			610			147			757
Less: Net income attributable to noncontrolling interests	27			—		27			16			—			16
Net income attributable to Aon shareholders	$	944		$	199	$	1,143		$	594		$	147		$	741

Diluted net income per share attributable to Aon shareholders
Diluted net income (loss) per share attributable to Aon shareholders
Continuing operations	$	3.11		0.48		$	3.59		$	2.35		$	0.62		$	2.97
Discontinued operations	0.37			0.26		0.63			0.02			(0.03		)	(0.01		)
Net income	$	3.48		$	0.74	$	4.22		$	2.37		$	0.59		$	2.96

Weighted average ordinary shares outstanding - diluted	271.0			—		271.0			250.2			—			250.2
Effective Tax Rates ⁽³⁾
Continuing Operations - U.S. GAAP									15.9		%				16.5		%
Discontinued Operations - U.S. GAAP									17.2		%				46.5		%



ENGLAND AND WALES		98-1030901
(State or Other Jurisdiction of		(I.R.S. Employer
Incorporation or Organization)		Identification No.)



122 LEADENHALL STREET, LONDON, ENGLAND		EC3V 4AN
(Address of Principal Executive Offices)		(Zip Code)



Large accelerated filer x		Accelerated filer o
Non-accelerated filer o		Smaller reporting company o
~~(Do not check if a smaller reporting company)~~		Emerging growth company o



PART I

	Item 1. Financial Statements
	Aon plc Condensed Consolidated Statements of Income
	Aon plc Condensed Consolidated Statements of Comprehensive Income
	Aon plc Condensed Consolidated Statements of Financial Position
	Aon plc Condensed Consolidated ~~Statement~~Statements of Shareholders’ Equity
	Aon plc Condensed Consolidated Statements of Cash Flows
	Notes to Condensed Consolidated Financial Statements

	Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
	Item 3. Quantitative and Qualitative Disclosures about Market Risk
	Item 4. Controls and Procedures

PART II

	Item 1. Legal Proceedings
	Item 1A. Risk Factors
	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
	Item 3. ~~Default~~Defaults Upon Senior Securities
	Item 4. Mine Safety Disclosures
	Item 5. Other Information
	Item 6. Exhibits
	Signature
	Exhibit Index



	Three months ended September 30						Nine months ended September 30
	2017			2016			2017		2016
Revenue
Total revenue	$	—		$	559		$	698	$	1,606
Expenses
Total operating expenses	14			491			640		1,443
Operating income from discontinued operations	(14		)	68			58		163
Other income	(1		)	(1		)	10		—
Income from discontinued operations before income taxes	(15		)	67			68		163
Income taxes	(6		)	25			14		61
Income from discontinued operations excluding gain, net of tax	(9		)	42			54		102
Gain on sale of discontinued operations, net of tax	5			—			803		—
Income from discontinued operations, net of tax	$	(4	)	$	42		$	857	$	102



	September 30, 2017 ⁽¹⁾		December 31, 2016
ASSETS
Cash and cash equivalents	$	—	$	5
Receivables, net	—		483
Fiduciary assets	—		526
Goodwill	—		1,337
Intangible assets, net	—		333
Fixed assets, net	—		215
Other assets	—		295
TOTAL ASSETS	$	—	$	3,194

LIABILITIES
Accounts payable and accrued liabilities	$	—	$	197
Fiduciary liabilities	—		526
Other liabilities	—		356
TOTAL LIABILITIES	$	—	$	1,079



As of	September 30, 2017		December 31, 2016
Taxes receivable	$	208	$	100
Prepaid expenses	158		102
Receivables from the Divested Business ⁽¹⁾	124		—
Other	28		45
Total	$	518	$	247



	For the nine months ended September 30, 2017
Cash	$	164
Deferred and contingent consideration	32
Aggregate consideration transferred	$	196

Assets acquired:
Cash and cash equivalents	$	7
Receivables, net	11
Goodwill	121
Intangible assets, net	90
Fixed assets, net	1
Other assets	10
Total assets acquired	240
Liabilities assumed:
Current liabilities	18
Other non-current liabilities	26
Total liabilities assumed	44
Net assets acquired	$	196



	Restructuring Plan
Balance as of December 31, 2016	$	—
Expensed	369
Cash payments	(199		)
Foreign currency translation and other	17
Balance as of September 30, 2017	$	187



Remainder of 2017	$	117
2018	376
2019	357
2020	196
2021	89
Thereafter	206
Total	$	1,341



	Change in Fair Value of Financial Instruments ⁽¹⁾			Foreign Currency Translation Adjustments			Post-Retirement Benefit Obligation ⁽²⁾			Total
Balance at December 31, 2016	$	(37	)	$	(1,264	)	$	(2,611	)	$	(3,912	)
Other comprehensive income (loss) before reclassifications, net	13			442			—			455
Amounts reclassified from accumulated other comprehensive loss:
Amounts reclassified from accumulated other comprehensive income (loss)	(2		)	(11		)	80			67
Tax benefit (expense)	2			—			(24		)	(22		)
Amounts reclassified from accumulated other comprehensive income (loss), net	—			(11		)	56			45
Net current period other comprehensive income (loss)	13			431			56			500
Balance at September 30, 2017	$	(24	)	$	(833	)	$	(2,555	)	$	(3,412	)



	September 30, 2017		December 31, 2016		December 31, 2015
Target PSAs granted during period	548		752		967
Weighted average fair value per share at date of grant	$	114	$	100	$	96
Number of shares that would be issued based on current performance levels	544		663		1,362
Unamortized expense, based on current performance levels	$	51	$	27	$	11



	Gross Amounts of Recognized Assets				Gross Amounts Offset in the Statement of Financial Position					Net Amounts of Assets Presented in the Statement of Financial Position ⁽¹⁾
Derivatives accounted for as hedges	September 30, 2017		December 31, 2016		September 30, 2017		December 31, 2016			September 30, 2017		December 31, 2016
Foreign exchange contracts	$	31	$	14	$	—	$	(1	)	$	31	$	13



	Gross Amounts of Recognized Liabilities				Gross Amounts Offset in the Statement of Financial Position					Net Amounts of Liabilities Presented in the Statement of Financial Position ⁽¹⁾
Derivatives accounted for as hedges	September 30, 2017		December 31, 2016		September 30, 2017		December 31, 2016			September 30, 2017		December 31, 2016
Foreign exchange contracts	$	3	$	13	$	—	$	(1	)	$	3	$	12



Cash Flow Hedge - Foreign Exchange Contracts	Location of Eventual Reclassification from Accumulated Other Comprehensive Loss										Gain (Loss) Currently Recognized in Accumulated Other Comprehensive Loss
Three months ended September 30	Compensation and Benefits		Other General Expenses			Interest Expense		Other Income (Expense)			Total
2017	$	—	$	3		$	—	$	8		$	11
2016	10		(4		)	—		(7		)	(1		)



Cash Flow Hedge - Foreign Exchange Contracts	Gain (Loss) reclassified from Accumulated Other Comprehensive Loss into Income (Effective Portion)
Three months ended September 30	Compensation and Benefits		Other General Expenses			Interest Expense		Other Income (Expense)			Total
2017	$	1	$	(1	)	$	—	$	(3	)	$	(3	)
2016	1		(1		)	—		(2		)	(2		)



	As of December 31, 2016
						Other
	Aon		Aon			Non-Guarantor			Consolidating
(millions)	plc		Corporation			Subsidiaries			Adjustments			Consolidated
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	—	$	1,633		$	655		$	(1,862	)	$	426
Short-term investments	—		140			150			—			290
Receivables, net	—		3			2,103			—			2,106
Fiduciary assets	—		—			8,959			—			8,959
Intercompany receivables	105		1,880			9,825			(11,810		)	—
Other current assets	—		25			222			—			247
Current assets of discontinued operations	—		—			1,118			—			1,118
Total Current Assets	105		3,681			23,032			(13,672		)	13,146
Goodwill	—		—			7,410			—			7,410
Intangible assets, net	—		—			1,890			—			1,890
Fixed assets, net	—		—			550			—			550
Deferred tax assets	134		726			171			(706		)	325
Intercompany receivables	366		261			8,711			(9,338		)	—
Prepaid pension	—		5			853			—			858
Other non-current assets	2		119			239			—			360
Investment in subsidiary	10,107		17,131			(356		)	(26,882		)	—
Non-current assets of discontinued operations	—		—			2,076			—			2,076
TOTAL ASSETS	$	10,714	$	21,923		$	44,576		$	(50,598	)	$	26,615

LIABILITIES AND EQUITY
LIABILITIES
CURRENT LIABILITIES
Accounts payable and accrued liabilities	$	585	$	44		$	2,837		$	(1,862	)	$	1,604
Short-term debt and current portion of long-term debt	279		50			7			—			336
Fiduciary liabilities	—		—			8,959			—			8,959
Intercompany payables	142		10,399			1,269			(11,810		)	—
Other current liabilities	—		63			593			—			656
Current liabilities of discontinued operations	—		—			940			—			940
Total Current Liabilities	1,006		10,556			14,605			(13,672		)	12,495
Long-term debt	4,177		1,413			279			—			5,869
Deferred tax liabilities	—		—			759			(658		)	101
Pension, other post-retirement and other post-employment liabilities	—		1,356			404			—			1,760
Intercompany payables	—		8,877			461			(9,338		)	—
Other non-current liabilities	8		77			634			—			719
Non-current liabilities of discontinued operations	—		—			139			—			139
TOTAL LIABILITIES	5,191		22,279			17,281			(23,668		)	21,083

TOTAL AON SHAREHOLDERS’ EQUITY	5,523		(356		)	27,238			(26,930		)	5,475
Noncontrolling interests	—		—			57			—			57
TOTAL EQUITY	5,523		(356		)	27,295			(26,930		)	5,532
TOTAL LIABILITIES AND EQUITY	$	10,714	$	21,923		$	44,576		$	(50,598	)	$	26,615



	Nine months ended September 30, 2017
	Aon			Aon			Other Non-Guarantor			Consolidating
(millions)	plc			Corporation			Subsidiaries			Adjustments			Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES
Cash provided by (used for) operating activities - continuing operations	$	(135	)	$	999		$	987		$	(1,562	)	$	289
Cash provided by operating activities - discontinued operations	—			—			64			—			64
CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES	(135		)	999			1,051			(1,562		)	353

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from investments	—			576			11			(544		)	43
Payments for investments	(16		)	(25		)	(571		)	557			(55		)
Net purchases of short-term investments - non-fiduciary	—			(1,328		)	(16		)	—			(1,344		)
Acquisition of businesses, net of cash acquired	—			1			(173		)	—			(172		)
Sale of businesses, net of cash sold	—			—			4,194			—			4,194
Capital expenditures	—			—			(125		)	—			(125		)
Cash provided by (used for) investing activities - continuing operations	(16		)	(776		)	3,320			13			2,541
Cash used for investing activities - discontinued operations	—			—			(19		)	—			(19		)
CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES	(16		)	(776		)	3,301			13			2,522

CASH FLOWS FROM FINANCING ACTIVITIES
Share repurchase	(1,888		)	—			—			—			(1,888		)
Advances from (to) affiliates	2,722			1,304			(4,274		)	248			—
Issuance of shares for employee benefit plans	(118		)	—			—			—			(118		)
Issuance of debt	544			1,100			7			—			1,651
Repayment of debt	(835		)	(1,150		)	(13		)	—			(1,998		)
Cash dividends to shareholders	(274		)	—			—			—			(274		)
Noncontrolling interests and other financing activities	—			—			(21		)	—			(21		)
Cash provided by (used for) financing activities - continuing operations	151			1,254			(4,301		)	248			(2,648		)
Cash used for financing activities - discontinued operations	—			—			—			—			—
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES	151			1,254			(4,301		)	248			(2,648		)

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	—			—			91			—			91
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	—			1,477			142			(1,301		)	318
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR ⁽¹⁾	—			1,633			660			(1,862		)	431
CASH AND CASH EQUIVALENTS AT END OF PERIOD ⁽²⁾	$	—		$	3,110		$	802		$	(3,163	)	$	749


(1)	~~The effective tax rates used in the U.S. GAAP financial statements for continuing operations were 2.0% and (49.8)%, respectively,~~Adjusted Other income (expense) excludes Pension settlement charges of $7 million for the three ~~and nine~~ months ended ~~September 30, 2017.~~ March 31, 2018.


~~(3)~~	Other costs associated with the Restructuring Plan include those to separate the Divested Business, as well as moving costs and consulting and legal fees. These costs are generally recognized when incurred.



	Statement of Financial Position Classification
Asset Type	Cash and Cash Equivalents		Short-term Investments		Fiduciary Assets		Total
Certificates of deposit, bank deposits or time deposits	$	600	$	—	$	2,619	$	3,219
Money market funds	—		134		1,845		1,979
Cash and short-term investments	600		134		4,464		5,198
Fiduciary receivables	—		—		6,948		6,948
Total	$	600	$	134	$	11,412	$	12,146


(1)	The proceeds of the commercial paper issuances were used primarily for short-term working capital needs.



	Rolling twelve months ended
	September 30,
	2017			2016
Net income	$	802		$	1,322
Interest expense	281			280
Income taxes	(118		)	192
Depreciation of fixed assets	192			161
Amortization and impairment of intangible assets	644			159
Restructuring charges	375			—
Non-cash pension expense	128			31
Total EBITDA	$	2,304		$	2,145
Total Debt	$	5,967		$	6,160
Total debt-to-EBITDA ratio	2.6			2.9



	Ratings
	Senior Long-term Debt	Commercial Paper	Outlook
Standard & Poor’s	A-	A-2	Stable
Moody’s Investor Services	Baa2	P-2	Stable
Fitch, Inc.	BBB+	F-2	Stable



Period	Total Number of Shares Purchased	Average Price Paid per Share ⁽¹⁾		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs ⁽²⁾	Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs ⁽¹⁾⁽²⁾
7/1/17 - 7/31/17	1,679,815	$	136.81	1,679,815	$	6,438,620,152
8/1/17 - 8/31/17	1,994,703	138.73		1,994,703	6,161,898,766
9/1/17 - 9/30/17	1,686,403	143.45		1,686,403	5,919,980,875
Total	5,360,921	$	139.61	5,360,921	$	5,919,980,875


(1)	Does not include commissions or other costs paid to repurchase shares.



	Aon plc
	(Registrant)

~~October 27, 2017~~April 26, 2019	By:	/s/ ~~Laurel Meissner~~Michael Neller
	~~LAUREL MEISSNER~~Michael Neller
	SENIOR VICE PRESIDENT AND
	GLOBAL CONTROLLER
	(Principal Accounting Officer and duly authorized officer of Registrant)



Exhibit Number		Description of Exhibit
~~12.1~~10.1#		~~Statement regarding Computation~~Aon plc Leadership Performance Program, as amended and restated, effective January 1, 2019.
10.2#		Form of ~~Ratio~~Restricted Stock Unit Agreement.
10.3		Form of ~~Earnings to Fixed Charges.~~notice of second extension of $900,000,000 Five-Year Credit Agreement among Aon plc, Aon Corporation and Aon UK Limited, as borrowers, Citibank, N.A., as administrative agent, the lenders party thereto, Bank of America, N.A. and Morgan Stanley Senior Funding, Inc., as syndication agents, entered into on February 2, 2015.
31.1		Certification of CEO.
31.2		Certification of CFO.
32.1		Certification of CEO Pursuant to section 1350 of Title 18 of the United States Code.
32.2		Certification of CFO Pursuant to section 1350 of Title 18 of the United States Code.
101		Interactive Data Files. The following materials are filed electronically with this Quarterly Report on Form 10-Q:
		101.INS XBRL Report Instance Document
		101.SCH XBRL Taxonomy Extension Schema Document
		101.CAL XBRL Taxonomy Calculation Linkbase Document
		101.DEF XBRL Taxonomy Definition Linkbase Document
		101.PRE XBRL Taxonomy Presentation Linkbase Document
		101.LAB XBRL Taxonomy Calculation Linkbase Document