iShares U.S. ETF Trust NCSR Certified annual shareholder report (management investment company)

iShares U.S. ETF Trust N-CSRCertified annual shareholder report (management investment company)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-22649

iShares U.S. ETF Trust

(Exact name of Registrant as specified in charter)

c/o: State Street Bank and Trust Company

1 Iron Street, Boston, MA 02210

(Address of principal executive offices) (Zip code)

The Corporation Trust Company

1209 Orange Street, Wilmington, DE 19801

(Name and address of agent for service)

Registrant’s telephone number, including area code: (415) 670-2000

Date of fiscal year end: July 31, 2016

Date of reporting period: July 31, 2016

Item 1.

Reports to Stockholders.

Copies of the annual reports transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 are attached.

JULY 31, 2016


2016 ANNUAL REPORT

iShares U.S. ETF Trust

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iShares Enhanced International Large-Cap ETF | IEIL | NYSE Arca

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iShares Enhanced International Small-Cap ETF | IEIS | NYSE Arca

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iShares Enhanced U.S. Large-Cap ETF | IELG | NYSE Arca

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iShares Enhanced U.S. Small-Cap ETF | IESM | NYSE Arca

Table of Contents


Management’s Discussions of Fund Performance			5
About Fund Performance			14
Shareholder Expenses			14
Schedules of Investments			15
iShares Enhanced International Large-Cap ETF			15
iShares Enhanced International Small-Cap ETF			18
iShares Enhanced U.S. Large-Cap ETF			23
iShares Enhanced U.S. Small-Cap ETF			26
Financial Statements			31
Financial Highlights			37
Notes to Financial Statements			41
Report of Independent Registered Public Accounting Firm			50
Tax Information			51
Board Review and Approval of Investment Advisory Contract			52
Supplemental Information			59
Trustee and Officer Information			62

Management’s Discussion of Fund Performance

iSHARES^® U.S. ETF TRUST

GLOBAL EQUITY MARKET OVERVIEW

Global equity markets declined modestly for the 12 months ended July 31, 2016 (the “reporting period”). The MSCI ACWI, a broad global equity index that includes both developed and emerging markets, returned -0.44% for the reporting period.

The modest overall decline in global stock markets masked significant volatility during the reporting period. Stocks fell during the first half of the reporting period amid lower energy prices and weaker global economic growth, including slowdowns in stronger developed economies such as the U.S. and U.K. In response, many of the world’s central banks took more aggressive actions to stimulate economic activity, including expanded quantitative easing measures and negative interest rates.

In the U.S., the Federal Reserve Bank (the “Fed”) postponed plans to raise its short-term interest rate target until December 2015, when it ended a seven-year period of near-zero interest rates by increasing the federal funds target rate from a range of 0%-0.25% to a range of 0.25%-0.50%. It was the Fed’s first interest rate hike since June 2006.

Central bank stimulus activity and a recovery in energy prices helped global equity markets reverse course after bottoming in mid-February 2016. The global equity market rally in the latter half of the reporting period was also driven by signs of stabilization in China, which had experienced a marked economic slowdown that put downward pressure on its currency. Late in the reporting period, market volatility increased following the “Brexit” referendum in the U.K., where an affirmative vote to leave the European Union led to a sharp decline in the British pound (which fell by 18% against the U.S. dollar for the reporting period) and increased expectations of an interest rate cut from the Bank of England.

Among developed markets, the U.S. was one of the few markets to advance, returning approximately 4% for the reporting period. Although employment growth remained robust, other segments of the U.S. economy struggled, leading to three consecutive quarters of growth below a 1.5% annual rate. As a result, the Fed — which was expected to raise short-term interest rates further in 2016 — held rates steady through the first seven months of the year. Stable Fed monetary policy provided a favorable backdrop for U.S. equity market performance.

Equity markets in the Asia/Pacific region were mixed. Australia and New Zealand posted positive returns for the reporting period, benefiting from improving economic growth. However, other markets in the region, including Japan and Singapore, fell during the reporting period. In particular, the Japanese equity market declined by nearly 20%, but a strong rally in the Japanese yen (which appreciated by 17% against the U.S. dollar) helped offset the overall market decline.

European stock markets declined by approximately 10% for the reporting period. Markets in Italy and Spain, which were adversely affected by political instability and struggling banking sectors, declined the most, while Belgium and Denmark performed best. In the U.K., the equity market advanced by about 4%, but the sharp decline in the British pound led to negative returns in U.S. dollar terms.

Emerging markets stocks declined by approximately 1% for the reporting period in U.S. dollar terms. Latin American equity markets generated the best returns, led by rebounding markets in Peru and Brazil. Stock markets in Eastern Europe fell the most, primarily because of sharp declines in Greece, Poland, and the Czech Republic.


MANAGEMENT’S DISCUSSIONSOF FUND PERFORMANCE			5

Management’s Discussion of Fund Performance

iSHARES^® ENHANCED INTERNATIONAL LARGE-CAP ETF

Performance as of July 31, 2016


	Average Annual Total Returns				Cumulative Total Returns
	1 Year		Since Inception		1 Year		Since Inception
Fund NAV		(6.35)%		(1.81)%		(6.35)%		(4.34)%
Fund Market		(6.82)%		(2.00)%		(6.82)%		(4.79)%
MSCI World ex USA Index		(6.88)%		(2.80)%		(6.88)%		(6.68)%

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

LOGO

The inception date of the Fund was 2/25/14. The first day of secondary market trading was 2/27/14.

The MSCI World ex USA Index is an unmanaged broad-based index that measures the performance of the large- and mid-capitalization sectors of developed equity markets, excluding the United States.

Past performance is no guarantee of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” on page 14 for more information.


Shareholder Expenses
Actual						Hypothetical 5% Return
Beginning Account Value (2/1/16)		Ending Account Value (7/31/16)		Expenses Paid During Period^a		Beginning Account Value (2/1/16)		Ending Account Value (7/31/16)		Expenses Paid During Period^a		Annualized Expense Ratio
$	1,000.00	$	1,056.50	$	1.79	$	1,000.00	$	1,023.10	$	1.76		0.35%

Expenses are calculated using the Fund’s annualized expense ratio (as disclosed in the table), multiplied by the average account value for the period, multiplied by the number of days in the period (182 days) and divided by the number of days in the year (366 days). See “Shareholder Expenses” on page 14 for more information.


6		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Management’s Discussion of Fund Performance (Continued)

iSHARES^® ENHANCED INTERNATIONAL LARGE-CAP ETF

The iShares Enhanced International Large-Cap ETF (the “Fund”) seeks long-term capital appreciation by investing, under normal circumstances, at least 80% of its net assets in equity securities of international large-capitalization issuers. The Fund is an actively managed exchange-traded fund that does not seek to replicate the performance of a specified index. For the 12-month reporting period ended July 31, 2016, the total return for the Fund was -6.35%, net of fees.

The Fund declined for the reporting period and performed in line with the -6.88% return of the MSCI World ex USA Index. The Fund combines the investment characteristics, or factors, of quality, value, and size exposures based on BlackRock insights. Quality is defined as a company that exhibits positive fundamentals, including high cash earnings, low earnings variability, and low debt-to-equity ratio, while value refers to companies with lower relative valuations based on measures such as price-to-earnings and price-to-book ratios. Size refers to relative market capitalization, and the Fund attempts to invest in stocks with lower relative market capitalizations.

The Fund was positioned to have less volatility than the broader market, and this positioning added value during the reporting period as the broad international equity markets experienced periods of significant volatility, particularly over the latter half of the reporting period. For example, international equity markets declined significantly in early 2016 amid lower energy prices and slowing global growth. International stocks subsequently rebounded somewhat before falling substantially again in late June following the U.K.’s referendum to leave the European Union.

The Fund’s exposure to stocks with smaller relative market capitalizations also added value, while exposure to value-oriented stocks detracted from performance.

As of the end of the reporting period, the Fund’s largest sector overweights relative to the MSCI World ex USA Index were telecommunication services and financials, while the largest underweights were consumer discretionary and healthcare.

Special Note: On June 23, 2016, the Board unanimously voted to close and liquidate the Fund. After the close of business on August 23, 2016, subject to applicable law, the Fund no longer accepted creation orders. Trading in the Fund was halted prior to market open on August 24, 2016. Proceeds of the liquidation were sent to shareholders on August 30, 2016.

ALLOCATION BY SECTOR

As of 7/31/16


Sector		Percentage of Total Investments*


Financials	28.92	%
Industrials	16.73
Telecommunication Services	10.42
Consumer Staples	10.18
Health Care	7.29
Materials	6.75
Energy	5.89
Utilities	5.07
Consumer Discretionary	4.88
Information Technology	3.87

TOTAL	100.00	%

TEN LARGEST COUNTRIES

As of 7/31/16


Country		Percentage of Total Investments*


Japan	26.15	%
Switzerland	13.14
United Kingdom	12.21
Canada	9.29
Denmark	5.90
Netherlands	5.53
Belgium	5.30
France	4.29
Australia	4.02
Germany	3.30

TOTAL	89.13	%

Excludes money market funds.


MANAGEMENT’S DISCUSSIONSOF FUND PERFORMANCE			7

Management’s Discussion of Fund Performance

iSHARES^® ENHANCED INTERNATIONAL SMALL-CAP ETF

Performance as of July 31, 2016


	Average Annual Total Returns				Cumulative Total Returns
	1 Year		Since Inception		1 Year		Since Inception
Fund NAV		6.62%		1.55%		6.62%		3.80%
Fund Market		5.99%		1.40%		5.99%		3.43%
MSCI World ex USA Small Cap Index		2.55%		0.69%		2.55%		1.68%

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

LOGO

The inception date of the Fund was 2/25/14. The first day of secondary market trading was 2/27/14.

The MSCI World ex USA Small Cap Index is an unmanaged broad-based index that measures the performance of the small-capitalization sector of developed equity markets, excluding the United States.


Shareholder Expenses
Actual						Hypothetical 5% Return
Beginning Account Value (2/1/16)		Ending Account Value (7/31/16)		Expenses Paid During Period^a		Beginning Account Value (2/1/16)		Ending Account Value (7/31/16)		Expenses Paid During Period^a		Annualized Expense Ratio
$	1,000.00	$	1,162.40	$	2.63	$	1,000.00	$	1,022.40	$	2.46		0.49%


8		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Management’s Discussion of Fund Performance (Continued)

iSHARES^® ENHANCED INTERNATIONAL SMALL-CAP ETF

The iShares Enhanced International Small-Cap ETF (the “Fund”) seeks long-term capital appreciation by investing, under normal circumstances, at least 80% of its net assets in equity securities of international small-capitalization issuers. The Fund is an actively managed exchange-traded fund that does not seek to replicate the performance of a specified index. For the 12-month reporting period ended July 31, 2016, the total return for the Fund was 6.62%, net of fees.

The Fund posted a positive return for the reporting period and outperformed the 2.55% return of the MSCI World ex USA Small Cap Index. The Fund combines the investment characteristics, or factors, of quality, value, and size exposures based on BlackRock insights. Quality is defined as a company that exhibits positive fundamentals, including high cash earnings, low earnings variability, and low debt-to-equity ratio, while value refers to companies with lower relative valuations based on measures such as price-to-earnings and price-to-book ratios. Size refers to relative market capitalization, and the Fund attempts to invest in stocks with lower relative market capitalizations.

The Fund’s exposure to value detracted from performance during the reporting period as value-oriented international stocks underperformed. The Fund’s exposure to stocks with smaller relative market capitalizations had little impact on overall performance.

As of the end of the reporting period, the Fund’s largest sector overweights relative to the MSCI World ex USA Small Cap Index were consumer discretionary and information technology, while the largest underweights were financials and industrials.

ALLOCATION BY SECTOR

As of 7/31/16


Sector		Percentage of Total Investments*


Consumer Discretionary	18.80	%
Industrials	16.65
Financials	16.49
Information Technology	12.82
Materials	11.78
Consumer Staples	7.83
Energy	6.42
Health Care	5.77
Telecommunication Services	2.40
Utilities	1.04

TOTAL	100.00	%

TEN LARGEST COUNTRIES As of 7/31/16


Country		Percentage of Total Investments*


Japan	33.65	%
United Kingdom	10.71
Australia	7.82
Canada	6.52
Denmark	6.18
Finland	4.60
Germany	4.11
Belgium	3.99
New Zealand	3.90
France	3.23

TOTAL	84.71	%

Excludes money market funds.


MANAGEMENT’S DISCUSSIONSOF FUND PERFORMANCE			9

Management’s Discussion of Fund Performance

iSHARES^® ENHANCED U.S. LARGE-CAP ETF

Performance as of July 31, 2016


	Average Annual Total Returns				Cumulative Total Returns
	1 Year		Since Inception		1 Year		Since Inception
Fund NAV		5.57%		12.26%		5.57%		46.36%
Fund Market		5.57%		12.28%		5.57%		46.44%
Russell 1000 Index		4.84%		12.50%		4.84%		47.33%

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

LOGO

The inception date of the Fund was 4/16/13. The first day of secondary market trading was 4/18/13.

The Russell 1000^® Index is an unmanaged broad-based index that measures the performance of the large- and mid-capitalization sectors of the U.S. equity market.


Shareholder Expenses
Actual						Hypothetical 5% Return
Beginning Account Value (2/1/16)		Ending Account Value (7/31/16)		Expenses Paid During Period^a		Beginning Account Value (2/1/16)		Ending Account Value (7/31/16)		Expenses Paid During Period^a		Annualized Expense Ratio
$	1,000.00	$	1,139.80	$	0.96	$	1,000.00	$	1,024.00	$	0.91		0.18%


10		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Management’s Discussion of Fund Performance (Continued)

iSHARES^® ENHANCED U.S. LARGE-CAP ETF

The iShares Enhanced U.S. Large-Cap ETF (the “Fund”) seeks long-term capital appreciation by investing, under normal circumstances, at least 80% of its net assets in equity securities of U.S. large-capitalization issuers. The Fund is an actively managed exchange-traded fund that does not seek to replicate the performance of a specified index. For the 12-month reporting period ended July 31, 2016, the total return for the Fund was 5.57%, net of fees.

The Fund posted a positive return for the reporting period and outperformed the 4.84% return of the Russell 1000^® Index. The Fund combines the investment characteristics, or factors, of quality, value, and size exposures based on BlackRock insights. Quality is defined as a company that exhibits positive fundamentals, including high cash earnings, low earnings variability, and low debt-to-equity ratio, while value refers to companies with lower relative valuations based on measures such as price-to-earnings and price-to-book ratios. Size refers to relative market capitalization, and the Fund attempts to invest in stocks with lower relative market capitalizations.

The Fund was positioned to have less volatility than the broader market, and this positioning added value during the reporting period as the broad U.S. equity market experienced periods of significant volatility, particularly over the latter half of the reporting period. For example, the domestic equity market declined significantly in early 2016 amid lower energy prices and slowing global growth. Stocks subsequently rebounded until late June, when concerns over the U.K.’s referendum to leave the European Union contributed to another sharp decline.

The Fund’s exposure to stocks with smaller relative market capitalizations also added value, while exposure to value-oriented stocks detracted from performance.

As of the end of the reporting period, the Fund’s largest sector overweights relative to the Russell 1000^® Index were information technology and utilities, while the largest underweights were consumer staples and materials.

ALLOCATION BY SECTOR

As of 7/31/16


Sector		Percentage of Total Investments*


Information Technology	31.21	%
Financials	18.54
Consumer Discretionary	13.30
Health Care	12.65
Utilities	7.13
Consumer Staples	5.60
Industrials	5.09
Energy	4.32
Telecommunication Services	2.16

TOTAL	100.00	%

TEN LARGEST FUND HOLDINGS

As of 7/31/16


Security		Percentage of Total Investments*


VMware Inc. Class A	2.46	%
Johnson & Johnson	2.43
CR Bard Inc.	2.26
Amazon.com Inc.	2.16
AT&T Inc.	2.15
Reinsurance Group of America Inc.	2.15
Intuit Inc.	2.15
Aflac Inc.	2.12
TJX Companies Inc. (The)	2.12
Intel Corp.	2.10

TOTAL	22.10	%

Excludes money market funds.


MANAGEMENT’S DISCUSSIONSOF FUND PERFORMANCE			11

Management’s Discussion of Fund Performance

iSHARES^® ENHANCED U.S. SMALL-CAP ETF

Performance as of July 31, 2016


	Average Annual Total Returns				Cumulative Total Returns
	1 Year		Since Inception		1 Year		Since Inception
Fund NAV		4.77%		10.78%		4.77%		40.11%
Fund Market		4.71%		10.76%		4.71%		40.03%
Russell 2000 Index		0.00%		10.34%		0.00%		38.21%

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

LOGO

The inception date of the Fund was 4/16/13. The first day of secondary market trading was 4/18/13.

The Russell 2000^® Index is an unmanaged broad-based index that measures the performance of the small-capitalization sector of the U.S. equity market.


Shareholder Expenses
Actual						Hypothetical 5% Return
Beginning Account Value (2/1/16)		Ending Account Value (7/31/16)		Expenses Paid During Period^a		Beginning Account Value (2/1/16)		Ending Account Value (7/31/16)		Expenses Paid During Period^a		Annualized Expense Ratio
$	1,000.00	$	1,187.80	$	1.90	$	1,000.00	$	1,023.10	$	1.76		0.35%


12		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Management’s Discussion of Fund Performance (Continued)

iSHARES^® ENHANCED U.S. SMALL-CAP ETF

The iShares Enhanced U.S. Small-Cap ETF (the “Fund”) seeks long-term capital appreciation by investing, under normal circumstances, at least 80% of its net assets in equity securities of U.S. small-capitalization issuers. The Fund is an actively managed exchange-traded fund that does not seek to replicate the performance of a specified index. For the 12-month reporting period ended July 31, 2016, the total return for the Fund was 4.77%, net of fees.

The Fund posted a positive return for the reporting period and outperformed the 0.00% return of the Russell 2000^® Index. The Fund combines the investment characteristics, or factors, of quality, value, and size exposures based on BlackRock insights. Quality is defined as a company that exhibits positive fundamentals, including high cash earnings, low earnings variability, and low debt-to-equity ratio, while value refers to companies with lower relative valuations based on measures such as price-to-earnings and price-to-book ratios. Size refers to relative market capitalization, and the Fund attempts to invest in stocks with lower relative market capitalizations.

The Fund’s exposure to stocks with smaller relative market capitalizations detracted from performance, as did exposure to value-oriented stocks.

As of the end of the reporting period, the Fund’s largest sector overweights relative to the Russell 2000^® Index were information technology and consumer staples, while the largest underweights were healthcare and materials.

ALLOCATION BY SECTOR

As of 7/31/16


Sector		Percentage of Total Investments*


Information Technology	26.80	%
Financials	22.75
Consumer Discretionary	14.88
Industrials	9.20
Health Care	7.58
Utilities	6.30
Energy	4.29
Consumer Staples	4.11
Materials	3.63
Telecommunication Services	0.46

TOTAL	100.00	%

TEN LARGEST FUND HOLDINGS

As of 7/31/16


Security		Percentage of Total Investments*


Cirrus Logic Inc.	2.61	%
Advanced Energy Industries Inc.	2.60
ManTech International Corp./VA Class A	2.49
LogMeIn Inc.	2.32
Children’s Place Inc. (The)	2.19
Cash America International Inc.	2.13
Hyatt Hotels Corp. Class A	2.00
American National Insurance Co.	2.00
Select Income REIT	1.98
MFA Financial Inc.	1.84

TOTAL	22.16	%

Excludes money market funds.


MANAGEMENT’S DISCUSSIONSOF FUND PERFORMANCE			13

About Fund Performance

Past performance is no guarantee of future results. Current performance may be lower or higher than the performance data quoted. Performance data current to the most recent month-end is available at www.ishares.com. Performance results assume reinvestment of all dividends and capital gain distributions and do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. The investment return and principal value of shares will vary with changes in market conditions. Shares may be worth more or less than their original cost when they are redeemed or sold in the market. Performance for certain funds may reflect a waiver of a portion of investment advisory fees. Without such a waiver, performance would have been lower.

Net asset value or “NAV” is the value of one share of a fund as calculated in accordance with the standard formula for valuing mutual fund shares. The price used to calculate market return (“Market Price”) is determined by using the midpoint between the highest bid and the lowest offer on the primary stock exchange on which shares of a fund are listed for trading, as of the time that such fund’s NAV is calculated. Certain funds may have a NAV which is determined prior to the opening of regular trading on its listed exchange and their market returns are calculated using the midpoint of the bid/ask spread as of the opening of regular trading on the exchange. Market and NAV returns assume that dividends and capital gain distributions have been reinvested at Market Price and NAV, respectively.

An index is a statistical composite that tracks a specified financial market or sector. Unlike a fund, an index does not actually hold a portfolio of securities and therefore does not incur the expenses incurred by a fund. These expenses negatively impact fund performance. Also, market returns do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, market returns would be lower.

Shareholder Expenses

As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including brokerage commissions on purchases and sales of fund shares and (2) ongoing costs, including management fees and other fund expenses. The expense example, which is based on an investment of $1,000 invested on February 1, 2016 and held through July 31, 2016, is intended to help you understand your ongoing costs (in dollars and cents) of investing in a Fund and to compare these costs with the ongoing costs of investing in other funds.

Actual Expenses — The table provides information about actual account values and actual expenses. Annualized expense ratios reflect contractual and voluntary fee waivers, if any. To estimate the expenses that you paid on your account over the period, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number corresponding to your Fund under the heading entitled “Expenses Paid During Period.”

Hypothetical Example for Comparison Purposes — The table also provides information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as brokerage commissions paid on purchases and sales of fund shares. Therefore, the hypothetical examples are useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.


14		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments

iSHARES^® ENHANCED INTERNATIONAL LARGE-CAP ETF

July 31, 2016


Security	Shares		Value
COMMON STOCKS — 97.96%

AUSTRALIA — 3.94%
Aristocrat Leisure Ltd.		8,085	$	97,952
ASX Ltd.		20,429		771,694
Brambles Ltd.		7,425		75,903
Caltex Australia Ltd.		2,850		71,829
CIMIC Group Ltd.		1,290		28,669
Dexus Property Group		11,597		86,116
GPT Group (The)		5,805		24,752
Qantas Airways Ltd.		65,774		157,973

				1,314,888
AUSTRIA — 0.58%
OMV AG		7,260		192,936

				192,936
BELGIUM — 5.19%
Ageas		2,970		99,951
bpost SA		5,460		143,025
Colruyt SA		1,125		62,763
Proximus SADP		10,793		336,914
Solvay SA		6,850		710,926
Telenet Group Holding NV^a		2,565		121,688
UCB SA		270		21,126
Umicore SA		4,095		236,930

				1,733,323
CANADA — 9.11%
Agnico Eagle Mines Ltd.		2,235		130,221
Alimentation Couche-Tard Inc. Class B		1,050		47,530
Bank of Montreal		5,739		368,356
Bank of Nova Scotia (The)		1,860		94,580
BCE Inc.		495		23,736
Canadian Imperial Bank of Commerce/Canada		8,084		614,894
Constellation Software Inc./Canada		1,827		744,656
Empire Co. Ltd. Class A		5,175		82,543
Franco-Nevada Corp.		615		47,477
George Weston Ltd.		150		13,338
Husky Energy Inc.		4,254		50,106
Intact Financial Corp.		165		11,842
National Bank of Canada		11,203		384,100
Open Text Corp.		615		37,521
Rogers Communications Inc. Class B		2,025		89,553
SNC-Lavalin Group Inc.		4,691		202,346
Thomson Reuters Corp.		2,310		97,445

				3,040,244


Security	Shares		Value
DENMARK — 5.79%
AP Moeller – Maersk A/S Class A		305	$	398,706
AP Moeller – Maersk A/S Class B		548		743,964
Coloplast A/S Class B		5,480		430,066
Danske Bank A/S		2,450		66,596
Jyske Bank A/S Registered		1,225		50,960
TDC A/S		38,394		202,145
Vestas Wind Systems A/S		548		38,261

				1,930,698
FINLAND — 2.35%
Neste OYJ		1,440		54,540
Nokian Renkaat OYJ		2,355		87,510
Stora Enso OYJ Class R		33,779		306,720
UPM-Kymmene OYJ		16,289		335,706

				784,476
FRANCE — 4.21%
Electricite de France SA		1,470		19,241
Eutelsat Communications SA		915		18,193
Lagardere SCA		2,025		51,732
Peugeot SA^a		34,510		521,362
SCOR SE		1,110		32,440
SES SA		7,080		155,138
SFR Group SA		390		9,215
Total SA		12,209		583,790
Veolia Environnement SA		630		13,991

				1,405,102
GERMANY — 3.12%
CTS Eventim AG & Co. KGaA		555		19,320
Deutsche Lufthansa AG Registered		39,694		471,843
MAN SE		345		36,180
Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen Registered		1,221		203,715
RWE AG^a		2,490		44,287
Telefonica Deutschland Holding AG		60,195		245,693
United Internet AG Registered^b		420		18,570

				1,039,608
HONG KONG — 0.43%
CK Hutchison Holdings Ltd.		7,500		87,758
PCCW Ltd.		33,000		24,027
Yue Yuen Industrial Holdings Ltd.		7,500		30,445

				142,230
ISRAEL — 2.16%
Bank Hapoalim BM		36,976		188,984


SCHEDULESOF INVESTMENTS			15

Schedule of Investments (Continued)

iSHARES^® ENHANCED INTERNATIONAL LARGE-CAP ETF

July 31, 2016


Security	Shares		Value
Bank Leumi le-Israel BM^a		29,806	$	107,528
Bezeq The Israeli Telecommunication Corp. Ltd.		198,657		396,282
Teva Pharmaceutical Industries Ltd.		495		26,663

				719,457
ITALY — 0.28%
EXOR SpA		1,455		56,670
Mediaset SpA		11,790		35,703

				92,373
JAPAN — 25.65%
Aisin Seiki Co. Ltd.		1,500		69,449
Aozora Bank Ltd.		60,000		221,886
Canon Inc.		4,500		128,873
Chubu Electric Power Co. Inc.		3,000		44,187
Daiichi Sankyo Co. Ltd.		10,500		252,139
Eisai Co. Ltd.		6,000		353,847
ITOCHU Corp.		6,000		68,644
Japan Airlines Co. Ltd.		19,500		608,109
Japan Exchange Group Inc.		1,500		21,515
JX Holdings Inc.		147,000		556,387
Kansai Electric Power Co. Inc. (The)^a		7,500		69,991
Kawasaki Heavy Industries Ltd.		138,000		413,387
KDDI Corp.		12,000		368,249
Kuraray Co. Ltd.		1,500		19,144
Lawson Inc.		1,500		115,773
Marubeni Corp.		45,000		211,289
Mitsubishi UFJ Financial Group Inc.		40,500		206,284
Mitsui & Co. Ltd.		21,000		247,631
Mizuho Financial Group Inc.		436,500		711,706
Nexon Co. Ltd.		3,000		45,080
Nippon Telegraph & Telephone Corp.		15,000		714,397
Nippon Yusen KK		48,000		86,179
Oracle Corp. Japan		3,000		183,246
Park24 Co. Ltd.		1,500		51,081
Resona Holdings Inc.		121,500		491,999
Shinsei Bank Ltd.		48,000		73,064
Sompo Japan Nipponkoa Holdings Inc.		1,500		49,237
Sumitomo Chemical Co. Ltd.		18,000		80,792
Sumitomo Corp.		6,000		63,463
Sumitomo Mitsui Financial Group Inc.		16,500		532,585
Sumitomo Rubber Industries Ltd.		4,500		64,283
Suntory Beverage & Food Ltd.		3,000		130,995
Takeda Pharmaceutical Co. Ltd.		1,500		67,151
Tohoku Electric Power Co. Inc.		6,000		77,397


Security	Shares		Value
Tokyo Electric Power Co. Holdings Inc.^a		133,500	$	526,262
Tokyo Gas Co. Ltd.		60,000		257,013
West Japan Railway Co.		6,000		374,982

				8,557,696
NETHERLANDS — 5.43%
Aegon NV		46,395		189,159
AerCap Holdings NV^a		1,305		47,646
Altice NV Class A^a		540		8,016
Altice NV Class B^a		435		6,433
Boskalis Westminster		4,635		170,317
Koninklijke Ahold Delhaize NV		46,621		1,113,581
NN Group NV		10,224		275,821

				1,810,973
NORWAY — 0.10%
Orkla ASA		3,541		32,917

				32,917
SINGAPORE — 1.71%
ComfortDelGro Corp. Ltd.		19,500		40,943
Singapore Airlines Ltd.		27,000		220,728
Singapore Exchange Ltd.		11,500		64,474
StarHub Ltd.		84,000		245,164

				571,309
SPAIN — 0.17%
Endesa SA		525		11,034
Mediaset Espana Comunicacion SA		4,110		47,247

				58,281
SWEDEN — 2.88%
Boliden AB		15,436		340,434
ICA Gruppen AB		13,944		467,828
Nordea Bank AB		16,151		144,317
Skandinaviska Enskilda Banken AB Class A		1,035		9,103

				961,682
SWITZERLAND — 12.89%
Aryzta AG		6,220		234,589
Baloise Holding AG Registered		2,542		287,223
Banque Cantonale Vaudoise Registered		90		61,089
Barry Callebaut AG Registered		198		259,780
Credit Suisse Group AG Registered		33,145		382,396
Helvetia Holding AG Registered		150		75,586
Lonza Group AG Registered		1		189
Novartis AG Registered		4,110		341,490


16		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments (Continued)

iSHARES^® ENHANCED INTERNATIONAL LARGE-CAP ETF

July 31, 2016


Security	Shares		Value
PSP Swiss Property AG Registered		315	$	31,860
Swiss Life Holding AG Registered		2,588		593,142
Swiss Prime Site AG Registered		416		38,331
Swiss Re AG		7,459		627,854
Swisscom AG Registered		1,340		661,508
Zurich Insurance Group AG		2,923		704,399

				4,299,436
UNITED KINGDOM — 11.97%
3i Group PLC		35,868		293,828
Ashtead Group PLC		4,365		69,313
AstraZeneca PLC		10,912		731,348
BP PLC		49,905		282,826
BT Group PLC		16,995		93,269
Centrica PLC		186,098		595,716
GlaxoSmithKline PLC		7,260		162,708
Imperial Brands PLC		4,995		264,180
Investec PLC		3,525		21,037
J Sainsbury PLC		169,186		503,841
Just Eat PLC^a		4,065		28,983
Marks & Spencer Group PLC		12,765		54,115
Micro Focus International PLC		1,410		36,243
Old Mutual PLC		21,510		60,145
Rentokil Initial PLC		124,691		355,937
Rightmove PLC		825		44,373
Royal Dutch Shell PLC Class A		5,265		135,892
Royal Mail PLC		8,640		58,447
RSA Insurance Group PLC		19,665		129,946
Sky PLC		5,835		71,312

				3,993,459

TOTAL COMMON STOCKS (Cost: $37,921,225)				32,681,088


Security	Shares		Value
PREFERRED STOCKS — 0.12%

GERMANY — 0.12%
Bayerische Motoren Werke AG		540	$	39,130

				39,130

TOTAL PREFERRED STOCKS (Cost: $51,508)				39,130

SHORT-TERM INVESTMENTS — 0.04%

MONEY MARKET FUNDS — 0.04%
BlackRock Cash Funds: Treasury, SL Agency Shares
0.28%^c,d		14,393		14,393

				14,393

TOTAL SHORT-TERM INVESTMENTS (Cost: $14,393)				14,393

TOTAL INVESTMENTS IN SECURITIES — 98.12% (Cost: $37,987,126)^e				32,734,611
Other Assets, Less Liabilities — 1.88%				627,047

NET ASSETS — 100.00%			$	33,361,658

^a	Non-income earning security.

^b	This security may be resold to qualified foreign investors and foreign institutional buyers under Regulation S of the Securities Act of 1933.

^c	Affiliated money market fund.

^d	The rate quoted is the annualized seven-day yield of the fund at period end.

^e	The cost of investments for federal income tax purposes was $38,129,377. Net unrealized depreciation was $5,394,766, of which $1,498,475 represented gross unrealized appreciation on securities and $6,893,241 represented gross unrealized depreciation on securities.

Schedule 1 — Fair Value Measurements

Various inputs are used in determining the fair value of financial instruments. For description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, see Note 1.

The following table summarizes the value of the Fund’s investments according to the fair value hierarchy as of July 31, 2016. The breakdown of the Fund’s investments into major categories is disclosed in the schedule of investments above.


	Level 1		Level 2		Level 3		Total
Investments:
Assets:
Common stocks	$	32,681,088	$	—	$	—	$	32,681,088
Preferred stocks		39,130		—		—		39,130
Money market funds		14,393		—		—		14,393

Total	$	32,734,611	$	—	$	—	$	32,734,611

See notes to financial statements.


SCHEDULESOF INVESTMENTS			17

Schedule of Investments

iSHARES^® ENHANCED INTERNATIONAL SMALL-CAP ETF

July 31, 2016


Security	Shares		Value
COMMON STOCKS — 98.05%

AUSTRALIA — 7.76%
Cabcharge Australia Ltd.		9,504	$	28,605
Downer EDI Ltd.		8,288		26,268
Estia Health Ltd.		29,114		113,517
Evolution Mining Ltd.		245,784		526,799
FlexiGroup Ltd./Australia		40,352		61,339
Independence Group NL		9,192		28,085
McMillan Shakespeare Ltd.		9,460		101,380
Metals X Ltd.		10,192		12,665
Mineral Resources Ltd.		1,866		13,927
MYOB Group Ltd.		3,848		11,026
Northern Star Resources Ltd.		122,624		491,166
OZ Minerals Ltd.		3,720		18,067
Pact Group Holdings Ltd.		2,792		12,075
Sandfire Resources NL		14,145		61,603
St. Barbara Ltd.^a		4,240		9,700

				1,516,222
AUSTRIA — 0.38%
Austria Technologie & Systemtechnik AG		2,312		27,418
EVN AG		2,160		25,241
S IMMO AG		1,257		12,159
UNIQA Insurance Group AG		1,544		9,565

				74,383
BELGIUM — 3.96%
AGFA-Gevaert NV^a		40,750		147,278
Cie. d’Entreprises CFE		840		77,401
Euronav NV		3,072		26,452
Gimv NV		384		20,861
Intervest Offices & Warehouses NV		416		11,837
Nyrstar NV^a		8,523		77,714
Orange Belgium SA^a		17,012		412,433

				773,976
CANADA — 6.47%
Amaya Inc.^a		8,470		131,267
Artis REIT		1,648		17,250
Cogeco Communications Inc.		2,866		141,229
Dominion Diamond Corp.		8,728		80,249
Granite REIT		354		11,032
Intertain Group Ltd. (The)^a		1,472		11,683
Laurentian Bank of Canada		5,506		204,398
Mainstreet Equity Corp.^a		872		22,903
Milestone Apartments REIT		4,880		78,324


Security	Shares		Value
Morguard REIT		1,498	$	18,035
NorthWest Healthcare Properties REIT		2,144		16,786
Spin Master Corp.^a,b		576		11,838
TMX Group Ltd.		9,429		421,180
Transcontinental Inc. Class A		1,712		24,694
Valener Inc.		1,056		18,269
Wajax Corp.		1,249		13,514
Yellow Pages Ltd./Canada^a		2,832		40,980

				1,263,631
DENMARK — 6.13%
Bavarian Nordic A/S^a		2,524		96,195
Dfds A/S		10,202		466,429
IC Group A/S		328		8,260
NKT Holding A/S		248		12,800
Per Aarsleff Holding A/S		512		12,008
Rockwool International A/S Class B		2,560		484,947
Schouw & Co.		1,669		96,856
TORM PLC^a		2,068		19,898

				1,197,393
FINLAND — 4.57%
Atria OYJ		1,096		10,969
Cramo OYJ		4,344		102,546
HKScan OYJ Class A		5,851		20,741
PKC Group OYJ		824		15,250
Ramirent OYJ		6,201		52,562
Sanoma OYJ		34,042		273,134
Sponda OYJ		55,082		252,541
Tieto OYJ		4,210		121,180
YIT OYJ		6,424		43,640

				892,563
FRANCE — 3.21%
Adocia^a		96		5,579
Assystem		640		17,599
Cegedim SA^a		464		13,563
Cegid Group SA		784		53,698
Cellectis SA^a		1,656		43,333
Cie. des Alpes		1,257		24,950
Ubisoft Entertainment SA^a		11,386		467,598

				626,320
GERMANY — 4.08%
ADLER Real Estate AG^a		952		14,287
Bauer AG		1,072		14,805
Borussia Dortmund GmbH & Co. KGaA		17,450		77,020
CENTROTEC Sustainable AG		1,640		25,858


18		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments (Continued)

iSHARES^® ENHANCED INTERNATIONAL SMALL-CAP ETF

July 31, 2016


Security	Shares		Value
CTS Eventim AG & Co. KGaA		1,552	$	54,027
Deutsche Beteiligungs AG		1,136		35,976
DIC Asset AG		1,065		10,378
Draegerwerk AG & Co. KGaA		184		10,498
MLP AG		8,320		32,191
PATRIZIA Immobilien AG^a		6,615		167,029
RHOEN-KLINIKUM AG		11,792		347,462
Sixt Leasing AG		336		7,176

				796,707
HONG KONG — 0.18%
SmarTone Telecommunications Holdings Ltd.		20,162		35,907

				35,907
ISRAEL — 3.18%
Delek Automotive Systems Ltd.		10,484		92,973
Harel Insurance Investments & Financial Services Ltd.		2,408		8,864
Ituran Location and Control Ltd.		648		15,526
Migdal Insurance & Financial Holding Ltd.^a		21,464		13,150
Oil Refineries Ltd.^a		497,008		178,649
Tower Semiconductor Ltd.^a		23,058		311,501

				620,663
ITALY — 0.08%
Juventus Football Club SpA^a		46,808		15,258

				15,258
JAPAN — 33.39%
Achilles Corp.		8,000		11,007
Aderans Co. Ltd.		2,400		10,983
Aichi Corp.		5,600		44,971
Arcland Sakamoto Co. Ltd.		3,200		35,814
Asahi Diamond Industrial Co. Ltd.		1,600		12,443
Asahi Holdings Inc.		3,200		54,861
Ashikaga Holdings Co. Ltd.		4,800		16,158
Avex Group Holdings Inc.		1,600		18,937
Cawachi Ltd.		2,400		56,203
CKD Corp.		2,400		22,645
Comforia Residential REIT Inc.		56		133,436
Cosmo Energy Holdings Co. Ltd.		9,600		106,786
Create Restaurants Holdings Inc.		2,400		24,847
DCM Holdings Co. Ltd.		1,600		13,739
Dip Corp.		8,000		242,767
Doshisha Co. Ltd.		800		16,838
Dydo Drinco Inc.		1,600		83,368
Enplas Corp.		1,600		45,244


Security	Shares		Value
Foster Electric Co. Ltd.		6,400	$	125,146
France Bed Holdings Co. Ltd.		3,200		28,789
Fuji Soft Inc.		1,600		40,061
Fujibo Holdings Inc.		16,000		47,617
G-Tekt Corp.		4,400		67,834
Geo Holdings Corp.		24,000		348,929
Godo Steel Ltd.		8,000		13,504
Heiwa Corp.		1,600		33,004
Heiwado Co. Ltd.		1,600		31,130
Hitachi Maxell Ltd.		12,400		209,318
Hokkaido Electric Power Co. Inc.		2,400		19,109
Hokuetsu Bank Ltd. (The)		8,000		16,783
Hokuetsu Kishu Paper Co. Ltd.		8,000		56,828
Hokuto Corp.		1,600		29,803
Idemitsu Kosan Co. Ltd.		22,581		441,991
IwaiCosmo Holdings Inc.		3,200		28,352
J-Oil Mills Inc.		16,000		54,174
Japan Petroleum Exploration Co. Ltd.		1,600		33,472
Japan Rental Housing Investments Inc.		16		13,692
Juki Corp.		1,600		13,942
Kamei Corp.		4,800		39,389
Kanamoto Co. Ltd.		2,400		50,372
Kanematsu Corp.		16,000		26,384
Kasai Kogyo Co. Ltd.		800		8,048
Kenedix Residential Investment Corp.		25		67,986
Kenedix Retail REIT Corp.		16		43,729
KEY Coffee Inc.		800		15,378
Kinugawa Rubber Industrial Co. Ltd.		16,000		121,462
Kohnan Shoji Co. Ltd.		20,800		428,847
Kura Corp.		800		42,387
Life Corp.		800		23,613
Maruha Nichiro Corp.		17,800		452,620
MCUBS MidCity Investment Corp.		8		29,117
Megachips Corp.		6,400		78,248
Mimasu Semiconductor Industry Co. Ltd.		1,600		16,564
Ministop Co. Ltd.		1,600		26,868
Mitsubishi Steel Manufacturing Co. Ltd.		16,000		26,853
Mixi Inc.		10,484		377,479
Morinaga Milk Industry Co. Ltd.		16,000		118,964
Murata Manufacturing Co. Ltd.		302		37,792
Musashi Seimitsu Industry Co. Ltd.		1,600		33,160
NEC Capital Solutions Ltd.		800		11,920
Nichiha Corp.		1,600		31,271
Nikkon Holdings Co. Ltd.		1,600		32,255


SCHEDULESOF INVESTMENTS			19

Schedule of Investments (Continued)

iSHARES^® ENHANCED INTERNATIONAL SMALL-CAP ETF

July 31, 2016


Security	Shares		Value
Nippon Coke & Engineering Co. Ltd.		32,000	$	20,920
Nippon Koei Co. Ltd.		8,000		25,604
Nippon Signal Co. Ltd.		1,600		15,394
Nishimatsuya Chain Co. Ltd.		6,400		91,612
Nissha Printing Co. Ltd.		1,600		31,911
Nisshin OilliO Group Ltd. (The)		16,000		75,718
Nisshin Steel Co. Ltd.		1,600		20,015
Okinawa Electric Power Co. Inc. (The)		3,600		72,502
Pacific Industrial Co. Ltd.		4,800		54,611
Park24 Co. Ltd.		806		27,447
Pioneer Corp.^a		4,000		7,377
Press Kogyo Co. Ltd.		16,800		62,620
Prima Meat Packers Ltd.		16,000		51,051
Riso Kagaku Corp.		1,600		23,262
Round One Corp.		2,400		16,299
Saizeriya Co. Ltd.		2,400		53,510
Sanyo Shokai Ltd.		16,000		29,819
Senshu Ikeda Holdings Inc.		18,400		80,613
Shinko Electric Industries Co. Ltd.		16,800		93,438
Showa Corp.		1,600		9,367
Tachi-S Co. Ltd.		1,600		27,789
Taiho Kogyo Co. Ltd.		2,400		25,924
Taikisha Ltd.		1,600		43,495
Takata Corp.^a		5,600		22,840
Tamron Co. Ltd.		1,600		23,402
Tatsuta Electric Wire and Cable Co. Ltd.		3,200		10,460
TOKAI Holdings Corp.		6,400		41,903
Tokyo Seimitsu Co. Ltd.		800		19,055
Tokyo TY Financial Group Inc.		1,800		47,632
Topy Industries Ltd.		16,000		35,908
Toridoll.corp.		1,600		46,914
Towa Bank Ltd. (The)		80,000		71,035
TPR Co. Ltd.		1,600		34,440
Tsukuba Bank Ltd.		5,600		17,540
UKC Holdings Corp.		4,800		76,343
Unipres Corp.		7,600		125,400
United Super Markets Holdings Inc.		3,200		30,943
Warabeya Nichiyo Co. Ltd.		2,400		50,630
Yahagi Construction Co. Ltd.		1,600		14,550
Yellow Hat Ltd.		1,600		36,844
Yorozu Corp.		7,200		113,320

				6,524,688
NETHERLANDS — 1.02%
COSMO Pharmaceuticals NV^a		742		119,847


Security	Shares		Value
Delta Lloyd NV		22,448	$	80,203

				200,050
NEW ZEALAND — 3.87%
Air New Zealand Ltd.		21,376		34,070
Fletcher Building Ltd.		71,550		500,022
Ryman Healthcare Ltd.		32,323		222,157

				756,249
NORWAY — 2.18%
BW LPG Ltd.^b		1,272		4,532
REC Silicon ASA^a		267,856		50,691
TGS Nopec Geophysical Co. ASA		22,335		371,503

				426,726
SINGAPORE — 1.75%
AIMS AMP Capital Industrial REIT		39,200		42,904
Cambridge Industrial Trust		116,800		47,830
Chip Eng Seng Corp. Ltd.		32,000		15,010
Ezion Holdings Ltd.^a		20,000		4,467
Far East Hospitality Trust		40,000		19,060
First REIT		24,000		23,230
k1 Ventures Ltd.		14,640		9,592
Noble Group Ltd.^a		821,796		99,122
Perennial Real Estate Holdings Ltd.		18,400		11,919
Yangzijiang Shipbuilding Holdings Ltd.		7,200		4,664
Yanlord Land Group Ltd.		72,000		63,256

				341,054
SPAIN — 0.14%
Abengoa SA Class B^a		43,864		10,889
Tubacex SA		6,608		17,402

				28,291
SWEDEN — 1.97%
Bure Equity AB		4,114		42,305
Haldex AB		1,936		23,878
Hemfosa Fastigheter AB		1,694		18,214
Industrial & Financial Systems Class B		742		31,607
Industrivarden AB Class C		2,887		48,718
Modern Times Group MTG AB Class B		1,282		33,517
NetEnt AB		1,104		9,373
Nolato AB Class B		2,819		76,145
Peab AB		3,870		31,202
Sweco AB Class B		1,815		33,393
Tethys Oil AB		5,638		37,164

				385,516
SWITZERLAND — 3.10%
Autoneum Holding AG		734		207,338


20		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments (Continued)

iSHARES^® ENHANCED INTERNATIONAL SMALL-CAP ETF

July 31, 2016


Security	Shares		Value
BKW AG		1,432	$	65,936
Emmi AG		136		87,951
Intershop Holdings AG		112		55,047
Mobilezone Holding AG		5,050		65,055
St Galler Kantonalbank AG Registered		128		52,745
Swissquote Group Holding SA Registered		480		11,920
Vetropack Holding AG Bearer		16		25,247
Zehnder Group AG^a		864		33,525

				604,764
UNITED KINGDOM — 10.63%
Beazley PLC		18,064		95,047
Berendsen PLC		6,936		117,598
BGEO Group PLC		560		20,305
Big Yellow Group PLC		2,192		20,663
Cape PLC		7,224		17,840
Carillion PLC		3,280		11,614
Centamin PLC		92,384		203,490
Chesnara PLC		3,424		14,218
Dairy Crest Group PLC		9,440		75,577
Dart Group PLC		22,724		146,328
Debenhams PLC		240,616		179,061
Devro PLC		3,896		14,665
Entertainment One Ltd.		19,644		51,458
Fenner PLC		4,584		9,799
FirstGroup PLC^a		23,232		30,938
Go-Ahead Group PLC		5,606		136,060
Greencore Group PLC		4,872		21,191
Greggs PLC		5,688		78,087
GVC Holdings PLC		1,827		15,306
Halfords Group PLC		2,656		12,430
Intermediate Capital Group PLC		2,548		19,384
Kcom Group PLC		12,088		17,654
Laird PLC		3,696		14,393
Lancashire Holdings Ltd.		24,856		198,833
LondonMetric Property PLC		12,568		26,999
Mitie Group PLC		27,560		91,003
Moneysupermarket.com Group PLC		6,776		26,855
Morgan Advanced Materials PLC		3,616		13,155
Northgate PLC		41,243		209,177
Paragon Group of Companies PLC (The)		5,624		20,362
Paysafe Group PLC^a		10,352		53,053
QinetiQ Group PLC		8,176		24,392
Restaurant Group PLC (The)		1,888		8,879


Security	Shares		Value
Savills PLC		1,000	$	9,281
Shanks Group PLC		15,064		21,101
Speedy Hire PLC		19,048		8,725
Trinity Mirror PLC		12,200		12,148
TT electronics PLC		9,400		16,817
Vesuvius PLC		2,768		13,524

				2,077,410

TOTAL COMMON STOCKS (Cost: $17,176,899)				19,157,771

PREFERRED STOCKS — 1.19%

ITALY — 1.19%
Intesa Sanpaolo SpA		111,592		232,605

				232,605

TOTAL PREFERRED STOCKS (Cost: $350,024)				232,605

SHORT-TERM INVESTMENTS — 0.11%

MONEY MARKET FUNDS — 0.11%
BlackRock Cash Funds: Treasury, SL Agency Shares
0.28%^c,d		21,793		21,793

				21,793

TOTAL SHORT-TERM INVESTMENTS (Cost: $21,793)				21,793

TOTAL INVESTMENTS IN SECURITIES — 99.35% (Cost: $17,548,716)^e				19,412,169
Other Assets, Less Liabilities — 0.65%				126,164

NET ASSETS — 100.00%			$	19,538,333

^a	Non-income earning security.

^b	This security may be resold to qualified institutional buyers under Rule 144A of the Securities Act of 1933.

^c	Affiliated money market fund.

^d	The rate quoted is the annualized seven-day yield of the fund at period end.

^e	The cost of investments for federal income tax purposes was $17,722,610. Net unrealized appreciation was $1,689,559, of which $3,449,467 represented gross unrealized appreciation on securities and $1,759,908 represented gross unrealized depreciation on securities.


SCHEDULESOF INVESTMENTS			21

Schedule of Investments (Continued)

iSHARES^® ENHANCED INTERNATIONAL SMALL-CAP ETF

July 31, 2016

Schedule 1 — Fair Value Measurements


	Level 1		Level 2		Level 3		Total
Investments:
Assets:
Common stocks	$	19,157,771	$	—	$	—	$	19,157,771
Preferred stocks		232,605		—		—		232,605
Money market funds		21,793		—		—		21,793

Total	$	19,412,169	$	—	$	—	$	19,412,169

See notes to financial statements.


22		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments

iSHARES^® ENHANCED U.S. LARGE-CAP ETF

July 31, 2016


Security	Shares			Value
COMMON STOCKS — 97.83%

AEROSPACE & DEFENSE — 2.01%
General Dynamics Corp.		6,133		$	900,876
L-3 Communications Holdings Inc.		2,932			444,579

					1,345,455
AIR FREIGHT & LOGISTICS — 1.50%
FedEx Corp.		6,210			1,005,399

					1,005,399
AIRLINES — 0.34%
Allegiant Travel Co.		1,724			223,723

					223,723
BANKS — 1.81%
Commerce Bancshares Inc./MO		7,268			343,704
JPMorgan Chase & Co.		13,510			864,234

					1,207,938
BEVERAGES — 0.20%
Molson Coors Brewing Co.		588			60,070
PepsiCo Inc.		669			72,868

					132,938
COMMUNICATIONS EQUIPMENT — 2.84%
Cisco Systems Inc.		43,548			1,329,521
F5 Networks Inc.^a		4,622			570,447

					1,899,968
CONSTRUCTION & ENGINEERING — 0.79%
Jacobs Engineering Group Inc.^a		1,560			83,491
Quanta Services Inc.^a		17,492			447,795

					531,286
DIVERSIFIED FINANCIAL SERVICES — 2.31%
Berkshire Hathaway Inc. Class B^a		767	��		110,655
CBOE Holdings Inc.		14,371			988,725
CME Group Inc.		2,245			229,529
FactSet Research Systems Inc.		265			45,569
Nasdaq Inc.		2,405			170,178

					1,544,656
DIVERSIFIED TELECOMMUNICATION SERVICES — 2.11%
AT&T Inc.		32,559			1,409,479

					1,409,479
ELECTRIC UTILITIES — 2.00%
Alliant Energy Corp.		6,162			248,020
Great Plains Energy Inc.		2,847			84,784
PG&E Corp.		13,763			880,006
Xcel Energy Inc.		2,816			123,848

					1,336,658


Security	Shares		Value
ELECTRICAL EQUIPMENT — 0.06%
Regal Beloit Corp.		650	$	39,656

				39,656
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS — 4.46%
Arrow Electronics Inc.^a		1,051		69,881
Avnet Inc.		1,879		77,227
Corning Inc.		60,589		1,346,288
Ingram Micro Inc. Class A		37,544		1,285,506
Jabil Circuit Inc.		10,082		205,169

				2,984,071
ENERGY EQUIPMENT & SERVICES — 3.61%
Helmerich & Payne Inc.		6,377		395,182
National Oilwell Varco Inc.		22,434		725,740
Schlumberger Ltd.		16,088		1,295,406

				2,416,328
FOOD & STAPLES RETAILING — 2.21%
CVS Health Corp.		1,521		141,027
Wal-Mart Stores Inc.		18,358		1,339,583

				1,480,610
FOOD PRODUCTS — 2.22%
Archer-Daniels-Midland Co.		24,762		1,116,271
Hormel Foods Corp.		3,454		129,007
JM Smucker Co. (The)		713		109,916
Tyson Foods Inc. Class A		1,751		128,874

				1,484,068
GAS UTILITIES — 0.58%
Atmos Energy Corp.		4,527		361,210
Piedmont Natural Gas Co. Inc.		494		29,541

				390,751
HEALTH CARE EQUIPMENT & SUPPLIES — 3.39%
Abbott Laboratories		3,823		171,079
Becton Dickinson and Co.		1,411		248,336
CR Bard Inc.		6,595		1,475,500
Medtronic PLC		4,219		369,711

				2,264,626
HEALTH CARE PROVIDERS & SERVICES — 3.98%
Aetna Inc.		1,048		120,740
AmerisourceBergen Corp.		10,931		931,212
Anthem Inc.		9,418		1,236,960
Cardinal Health Inc.		977		81,677
Cigna Corp.		269		34,691
UnitedHealth Group Inc.		1,781		255,039

				2,660,319


SCHEDULESOF INVESTMENTS			23

Schedule of Investments (Continued)

iSHARES^® ENHANCED U.S. LARGE-CAP ETF

July 31, 2016


Security	Shares		Value
HOTELS, RESTAURANTS & LEISURE — 1.62%
Carnival Corp.		19,433	$	907,910
Panera Bread Co. Class A^a		807		176,991

				1,084,901
HOUSEHOLD PRODUCTS — 0.85%
Procter & Gamble Co. (The)		6,645		568,746

				568,746
INSURANCE — 14.02%
Aflac Inc.		19,188		1,386,909
Allied World Assurance Co. Holdings AG		20,292		831,769
American Financial Group Inc./OH		3,058		223,540
Axis Capital Holdings Ltd.		16,712		928,853
Chubb Ltd.		10,183		1,275,522
Lincoln National Corp.		4,690		204,812
Loews Corp.		31,064		1,283,875
MetLife Inc.		7,547		322,559
Principal Financial Group Inc.		4,644		216,550
Prudential Financial Inc.		6,774		510,014
Reinsurance Group of America Inc.		14,191		1,408,457
Torchmark Corp.		6,061		374,994
Travelers Companies Inc. (The)		2,550		296,361
Validus Holdings Ltd.		2,218		109,636

				9,373,851
INTERNET & CATALOG RETAIL — 2.12%
Amazon.com Inc.^a		1,866		1,415,939

				1,415,939
INTERNET SOFTWARE & SERVICES — 3.33%
Akamai Technologies Inc.^a		1,326		67,003
Alphabet Inc. Class A^a		955		755,730
Alphabet Inc. Class C^a		995		764,946
eBay Inc.^a		20,589		641,553

				2,229,232
IT SERVICES — 5.54%
Amdocs Ltd.		13,319		777,297
Automatic Data Processing Inc.		1,774		157,797
Jack Henry & Associates Inc.		315		28,114
PayPal Holdings Inc.^a		19,198		714,933
Teradata Corp.^a		47,131		1,337,578
Total System Services Inc.		11,115		565,976
Xerox Corp.		12,224		125,907

				3,707,602
MACHINERY — 0.28%
AGCO Corp.		3,881		186,909

				186,909


Security	Shares		Value
MULTI-UTILITIES — 4.39%
Consolidated Edison Inc.		14,669	$	1,174,693
DTE Energy Co.		13,221		1,289,312
Public Service Enterprise Group Inc.		10,266		472,339

				2,936,344
MULTILINE RETAIL — 2.32%
Nordstrom Inc.		23,724		1,049,312
Target Corp.		6,699		504,636

				1,553,948
OIL, GAS & CONSUMABLE FUELS — 0.62%
California Resources Corp.		17		175
Chevron Corp.		3,655		374,564
Occidental Petroleum Corp.		504		37,664

				412,403
PHARMACEUTICALS — 5.02%
Eli Lilly & Co.		2,760		228,776
Johnson & Johnson		12,720		1,592,926
Merck & Co. Inc.		9,665		566,949
Pfizer Inc.		26,155		964,858

				3,353,509
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT — 2.14%
Intel Corp.		39,358		1,372,020
Maxim Integrated Products Inc.		1,482		60,436

				1,432,456
SOFTWARE — 7.26%
Citrix Systems Inc.^a		5,227		465,883
Intuit Inc.		12,656		1,404,689
Microsoft Corp.		23,152		1,312,255
Red Hat Inc.^a		800		60,232
VMware Inc. Class A^a		22,059		1,609,866

				4,852,925
SPECIALTY RETAIL — 5.58%
Bed Bath & Beyond Inc.		5,809		261,115
GameStop Corp. Class A		15,736		487,029
O’Reilly Automotive Inc.^a		4,527		1,315,682
Ross Stores Inc.		4,544		280,956
TJX Companies Inc. (The)		16,938		1,384,173

				3,728,955
TECHNOLOGY HARDWARE, STORAGE & PERIPHERALS — 4.95%
Apple Inc.		12,197		1,271,049
EMC Corp.		47,417		1,340,953


24		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments (Continued)

iSHARES^® ENHANCED U.S. LARGE-CAP ETF

July 31, 2016


Security	Shares		Value
Western Digital Corp.		14,727	$	699,680

				3,311,682
TEXTILES, APPAREL & LUXURY GOODS — 1.37%
Coach Inc.		6,371		274,654
NIKE Inc. Class B		11,525		639,637

				914,291

TOTAL COMMON STOCKS (Cost: $58,057,383)				65,421,622

SHORT-TERM INVESTMENTS — 0.06%

MONEY MARKET FUNDS — 0.06%
BlackRock Cash Funds: Treasury, SL Agency Shares
0.28%^b,c		40,468		40,468

				40,468

TOTAL SHORT-TERM INVESTMENTS (Cost: $40,468)				40,468


	Value
TOTAL INVESTMENTS IN SECURITIES — 97.89% (Cost: $58,097,851)^d	$	65,462,090
Other Assets, Less Liabilities — 2.11%		1,410,681

NET ASSETS — 100.00%	$	66,872,771

^a	Non-income earning security.

^b	Affiliated money market fund.

^c	The rate quoted is the annualized seven-day yield of the fund at period end.

^d	The cost of investments for federal income tax purposes was $58,167,422. Net unrealized appreciation was $7,294,668, of which $9,564,217 represented gross unrealized appreciation on securities and $2,269,549 represented gross unrealized depreciation on securities.

Schedule 1 — Fair Value Measurements


	Level 1		Level 2		Level 3		Total
Investments:
Assets:
Common stocks	$	65,421,622	$	—	$	—	$	65,421,622
Money market funds		40,468		—		—		40,468

Total	$	65,462,090	$	—	$	—	$	65,462,090

See notes to financial statements.


SCHEDULESOF INVESTMENTS			25

Schedule of Investments

iSHARES^® ENHANCED U.S. SMALL-CAP ETF

July 31, 2016


Security	Shares		Value
COMMON STOCKS — 99.47%

AEROSPACE & DEFENSE — 1.81%
BWX Technologies Inc.		7,434	$	273,645
KLX Inc.^a		2,587		83,560
National Presto Industries Inc.		1,003		89,809

				447,014
BANKS — 4.36%
1st Source Corp.		624		20,973
American National Bankshares Inc.		899		23,608
Arrow Financial Corp.		1,163		36,739
BancFirst Corp.		247		16,196
Bank of Marin Bancorp.		457		22,658
Camden National Corp.		350		15,218
City Holding Co.		437		20,408
CNB Financial Corp./PA		899		16,586
Community Trust Bancorp. Inc.		1,356		47,162
First Financial Corp./IN		1,098		42,053
First Interstate BancSystem Inc.		14,372		417,363
First of Long Island Corp. (The)		640		19,424
Great Southern Bancorp. Inc.		503		19,718
Great Western Bancorp. Inc.		1,103		36,586
Heritage Financial Corp./WA		2,486		43,405
Horizon Bancorp./IN		767		21,108
Lakeland Financial Corp.		636		32,659
Merchants Bancshares Inc./VT		503		15,985
S&T Bancorp. Inc.		548		13,968
State Bank Financial Corp.		986		21,574
Stock Yards Bancorp. Inc.		1,255		37,073
Tompkins Financial Corp.		254		18,476
Triumph Bancorp. Inc.^a		1,479		25,838
Trustmark Corp.		2,118		55,280
Univest Corp. of Pennsylvania		747		15,754
WesBanco Inc.		690		21,335

				1,077,147
BIOTECHNOLOGY — 0.06%
Kite Pharma Inc.^a		256		14,497

				14,497
BUILDING PRODUCTS — 0.06%
AAON Inc.		574		15,200

				15,200
CAPITAL MARKETS — 2.32%
Artisan Partners Asset Management Inc.		1,159		32,406
Diamond Hill Investment Group Inc.		826		157,758


Security	Shares		Value
GAMCO Investors Inc. Class A		421	$	14,373
Greenhill & Co. Inc.		617		12,235
Houlihan Lokey Inc.		1,507		34,555
Moelis & Co. Class A		3,920		97,569
WisdomTree Investments Inc.		22,442		223,073

				571,969
CHEMICALS — 1.74%
Axiall Corp.		3,432		112,055
Cabot Corp.		5,719		278,458
Hawkins Inc.		886		37,868

				428,381
COMMERCIAL SERVICES & SUPPLIES — 2.07%
Ennis Inc.		19,406		336,112
Kimball International Inc. Class B		4,513		51,403
McGrath RentCorp		671		21,385
Quad/Graphics Inc.		1,656		41,996
UniFirst Corp./MA		208		24,311
VSE Corp.		564		35,848

				511,055
COMMUNICATIONS EQUIPMENT — 1.51%
Black Box Corp.		1,660		22,659
EchoStar Corp. Class A^a		8,282		322,584
NETGEAR Inc.^a		535		27,515

				372,758
CONSTRUCTION & ENGINEERING — 0.20%
MasTec Inc.^a		2,021		49,413

				49,413
CONSUMER FINANCE — 2.41%
Cash America International Inc.		12,184		522,084
Ezcorp Inc. Class A^a		7,968		72,190

				594,274
DISTRIBUTORS — 0.19%
Core-Mark Holding Co. Inc.		958		46,904

				46,904
DIVERSIFIED CONSUMER SERVICES — 0.80%
Apollo Education Group Inc.^a		5,926		53,275
Capella Education Co.		2,076		124,290
Strayer Education Inc.^a		447		20,437

				198,002
DIVERSIFIED TELECOMMUNICATION SERVICES — 0.15%
Inteliquent Inc.		1,803		37,052

				37,052


26		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments (Continued)

iSHARES^® ENHANCED U.S. SMALL-CAP ETF

July 31, 2016


Security	Shares		Value
ELECTRIC UTILITIES — 2.79%
ALLETE Inc.		311	$	19,858
El Paso Electric Co.		6,524		311,064
Empire District Electric Co. (The)		5,607		189,124
MGE Energy Inc.		2,981		167,383

				687,429
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS — 2.60%
AVX Corp.		1,679		22,935
Benchmark Electronics Inc.^a		4,537		106,347
Dolby Laboratories Inc. Class A		5,002		251,651
Mesa Laboratories Inc.		148		17,113
Methode Electronics Inc.		1,046		36,642
PC Connection Inc.		834		21,526
ScanSource Inc.^a		623		25,562
Tech Data Corp.^a		1,709		133,182
TTM Technologies Inc.^a		2,575		25,621

				640,579
ENERGY EQUIPMENT & SERVICES — 3.90%
C&J Energy Services Ltd.^a		19,392		7,175
Diamond Offshore Drilling Inc.		3,292		74,794
Key Energy Services Inc.^a		27,140		1,927
Matrix Service Co.^a		4,650		77,051
Natural Gas Services Group Inc.^a		1,006		25,261
Oil States International Inc.^a		7,501		231,931
Patterson-UTI Energy Inc.		1,024		19,855
Rowan Companies PLC Class A		1,767		26,929
RPC Inc.^a		10,682		154,782
Superior Energy Services Inc.		15,792		252,198
Unit Corp.^a		7,324		91,550

				963,453
FOOD & STAPLES RETAILING — 0.47%
SpartanNash Co.		2,592		81,648
Weis Markets Inc.		672		34,722

				116,370
FOOD PRODUCTS — 1.04%
Fresh Del Monte Produce Inc.		3,418		194,313
Omega Protein Corp.^a		2,730		61,480

				255,793
GAS UTILITIES — 2.05%
Chesapeake Utilities Corp.		2,865		183,560
New Jersey Resources Corp.		1,537		57,238
Northwest Natural Gas Co.		2,613		169,688
ONE Gas Inc.		1,481		96,206

				506,692


Security	Shares		Value
HEALTH CARE EQUIPMENT & SUPPLIES — 3.14%
CryoLife Inc.		1,478	$	21,534
Exactech Inc.^a		743		20,083
Halyard Health Inc.^a		3,239		112,037
Hill-Rom Holdings Inc.		6,643		354,936
ICU Medical Inc.^a		1,247		145,600
Vascular Solutions Inc.^a		2,659		121,968

				776,158
HEALTH CARE PROVIDERS & SERVICES — 3.18%
Addus HomeCare Corp.^a		1,327		25,027
Almost Family Inc.^a		1,010		40,188
BioTelemetry Inc.^a		2,152		40,931
LHC Group Inc.^a		1,799		81,423
Magellan Health Inc.^a		1,964		134,475
Triple-S Management Corp. Class B^a		17,363		431,471
U.S. Physical Therapy Inc.		518		30,883

				784,398
HEALTH CARE TECHNOLOGY — 0.06%
Quality Systems Inc.		1,175		14,429

				14,429
HOTELS, RESTAURANTS & LEISURE — 3.81%
Bob Evans Farms Inc./DE		1,355		49,837
Cheesecake Factory Inc. (The)		2,793		144,482
Hyatt Hotels Corp. Class A^a		9,729		490,731
Red Robin Gourmet Burgers Inc.^a		273		13,202
Texas Roadhouse Inc.		5,136		242,522

				940,774
HOUSEHOLD DURABLES — 0.24%
CSS Industries Inc.		2,241		58,961

				58,961
INSURANCE — 8.11%
American National Insurance Co.		4,287		490,218
Aspen Insurance Holdings Ltd.		5,121		235,361
EMC Insurance Group Inc.		1,846		51,190
FBL Financial Group Inc. Class A		1,099		68,545
Fidelity & Guaranty Life		776		16,963
HCI Group Inc.		502		15,140
Heritage Insurance Holdings Inc.		20,340		252,013
Horace Mann Educators Corp.		7,582		259,153
Kansas City Life Insurance Co.		1,894		73,771
Maiden Holdings Ltd.		11,239		157,009
National Western Life Group Inc.		478		90,409
Navigators Group Inc. (The)		823		77,090


SCHEDULESOF INVESTMENTS			27

Schedule of Investments (Continued)

iSHARES^® ENHANCED U.S. SMALL-CAP ETF

July 31, 2016


Security	Shares		Value
OneBeacon Insurance Group Ltd. Class A		1,377	$	19,292
United Fire Group Inc.		1,660		69,720
Universal Insurance Holdings Inc.		5,712		124,179

				2,000,053
INTERNET & CATALOG RETAIL — 3.74%
1-800-Flowers.com Inc. Class A^a		49,107		448,347
NutriSystem Inc.		8,204		242,674
PetMed Express Inc.		3,352		69,487
Wayfair Inc. Class A^a		3,710		161,385

				921,893
INTERNET SOFTWARE & SERVICES — 3.20%
Carbonite Inc.^a		2,136		23,517
comScore Inc.^a		883		22,914
LogMeIn Inc.^a		6,626		569,240
Marketo Inc.^a		894		31,451
Shutterstock Inc.^a		1,814		99,933
Stamps.com Inc.^a		274		20,770
Wix.com Ltd.^a		621		22,108

				789,933
IT SERVICES — 2.92%
CACI International Inc. Class A^a		280		26,692
CSG Systems International Inc.		1,631		65,664
ManTech International Corp./VA Class A		15,457		610,706
Sykes Enterprises Inc.^a		563		17,279

				720,341
LEISURE PRODUCTS — 1.89%
Johnson Outdoors Inc. Class A		811		24,695
Sturm Ruger & Co. Inc.		6,125		416,500
Vista Outdoor Inc.^a		484		24,224

				465,419
MACHINERY — 1.74%
Briggs & Stratton Corp.		903		20,525
Chart Industries Inc.^a		1,471		44,160
Kennametal Inc.		14,627		363,627

				428,312
MARINE — 0.06%
Scorpio Bulkers Inc.^a		4,167		13,709

				13,709
MEDIA — 0.24%
Harte-Hanks Inc.		6,542		10,860
Time Inc.		2,955		48,255

				59,115


Security	Shares		Value
METALS & MINING — 1.87%
Kaiser Aluminum Corp.		5,213	$	431,897
Schnitzer Steel Industries Inc. Class A		1,513		29,488

				461,385
MULTI-UTILITIES — 0.32%
Unitil Corp.		1,823		79,738

				79,738
MULTILINE RETAIL — 0.24%
Big Lots Inc.		469		24,942
Fred’s Inc. Class A		2,135		33,925

				58,867
OIL, GAS & CONSUMABLE FUELS — 0.36%
Bonanza Creek Energy Inc.^a		20,422		16,401
Denbury Resources Inc.		7,668		22,237
Matador Resources Co.^a		829		17,483
Stone Energy Corp.^a,b		1,182		14,515
Triangle Petroleum Corp.^a		12,917		2,771
W&T Offshore Inc.^a		8,431		16,778

				90,185
PERSONAL PRODUCTS — 2.29%
Medifast Inc.		5,006		176,311
Nutraceutical International Corp.^a		808		20,717
USANA Health Sciences Inc.^a		2,681		368,155

				565,183
PHARMACEUTICALS — 1.10%
SciClone Pharmaceuticals Inc.^a		25,700		271,392

				271,392
PROFESSIONAL SERVICES — 1.79%
ICF International Inc.^a		1,312		54,290
Navigant Consulting Inc.^a		2,349		46,299
RPX Corp.^a		33,826		340,628

				441,217
REAL ESTATE INVESTMENT TRUSTS (REITS) — 4.73%
Agree Realty Corp.		781		39,612
Care Capital Properties Inc.		4,820		142,576
Dynex Capital Inc.		6,417		45,047
Gyrodyne LLC		86		1,746
MFA Financial Inc.		60,103		451,975
Select Income REIT		17,544		487,021

				1,167,977
ROAD & RAIL — 1.36%
Knight Transportation Inc.		718		21,418
Marten Transport Ltd.		6,204		134,317


28		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Schedule of Investments (Continued)

iSHARES^® ENHANCED U.S. SMALL-CAP ETF

July 31, 2016


Security	Shares		Value
Werner Enterprises Inc.		7,137	$	179,281

				335,016
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT — 6.98%
Advanced Energy Industries Inc.^a		15,671		638,123
Alpha & Omega Semiconductor Ltd.^a		3,748		53,559
Cirrus Logic Inc.^a		13,194		641,096
Integrated Device Technology Inc.^a		6,440		141,616
MaxLinear Inc. Class A^a		3,112		67,873
Synaptics Inc.^a		3,465		180,007

				1,722,274
SOFTWARE — 7.08%
AVG Technologies NV^a		10,551		260,926
Ellie Mae Inc.^a		409		37,673
Gigamon Inc.^a		4,203		196,364
HubSpot Inc.^a		1,381		75,389
Imperva Inc.^a		4,162		196,114
Infoblox Inc.^a		742		13,890
Pegasystems Inc.		14,013		390,963
Proofpoint Inc.^a		1,069		81,105
Take-Two Interactive Software Inc.^a		712		28,608
VirnetX Holding Corp.^a,b		6,813		22,755
Zendesk Inc.^a		14,693		444,316

				1,748,103
SPECIALTY RETAIL — 3.58%
Ascena Retail Group Inc.^a		15,451		125,616
Children’s Place Inc. (The)		6,427		537,169
Kirkland’s Inc.^a		1,616		24,628
Select Comfort Corp.^a		6,006		143,303
Stage Stores Inc.		2,258		13,390
Tilly’s Inc. Class A^a		6,781		38,584

				882,690
TECHNOLOGY HARDWARE, STORAGE & PERIPHERALS — 2.37%
Lexmark International Inc. Class A		5,677		208,176
Nimble Storage Inc.^a		14,954		111,258
Stratasys Ltd.^a		12,659		265,079

				584,513
TEXTILES, APPAREL & LUXURY GOODS — 0.08%
Culp Inc.		728		20,770

				20,770
THRIFTS & MORTGAGE FINANCE — 0.69%
First Defiance Financial Corp.		1,345		56,073
Meta Financial Group Inc.		558		30,517


Security	Shares		Value
Territorial Bancorp. Inc.		2,412	$	64,883
United Financial Bancorp. Inc.		1,519		19,975

				171,448
TOBACCO — 0.29%
Universal Corp./VA		1,192		70,698

				70,698
TRADING COMPANIES & DISTRIBUTORS — 0.07%
NOW Inc.^a		943		17,266

				17,266
WATER UTILITIES — 1.11%
American States Water Co.		2,670		115,344
Artesian Resources Corp. Class A		901		30,715
California Water Service Group		1,847		62,299
Middlesex Water Co.		692		28,587
York Water Co. (The)		1,143		35,936

				272,881
WIRELESS TELECOMMUNICATION SERVICES — 0.30%
U.S. Cellular Corp.^a		1,847		74,711

				74,711

TOTAL COMMON STOCKS (Cost: $22,352,300)				24,543,791

SHORT-TERM INVESTMENTS — 0.35%

MONEY MARKET FUNDS — 0.35%
BlackRock Cash Funds: Institutional, SL Agency Shares
0.57%^c,d,e		6,169		6,169
BlackRock Cash Funds: Prime, SL Agency Shares
0.47%^c,d,e		341		341
BlackRock Cash Funds: Treasury, SL Agency Shares
0.28%^c,d		80,564		80,564

				87,074

TOTAL SHORT-TERM INVESTMENTS (Cost: $87,074)				87,074


SCHEDULESOF INVESTMENTS			29

Schedule of Investments (Continued)

iSHARES^® ENHANCED U.S. SMALL-CAP ETF

July 31, 2016


	Value
TOTAL INVESTMENTS IN SECURITIES — 99.82% (Cost: $22,439,374)^f	$	24,630,865
Other Assets, Less Liabilities — 0.18%		43,623

NET ASSETS — 100.00%	$	24,674,488

^a	Non-income earning security.

^b	All or a portion of this security represents a security on loan. See Note 1.

^c	Affiliated money market fund.

^d	The rate quoted is the annualized seven-day yield of the fund at period end.

^e	All or a portion of this security represents an investment of securities lending collateral. See Note 1.

^f	The cost of investments for federal income tax purposes was $22,457,077. Net unrealized appreciation was $2,173,788, of which $4,274,145 represented gross unrealized appreciation on securities and $2,100,357 represented gross unrealized depreciation on securities.

Schedule 1 — Fair Value Measurements


	Level 1		Level 2		Level 3		Total
Investments:
Assets:
Common stocks	$	24,521,036	$	22,755	$	—	$	24,543,791
Money market funds		87,074		—		—		87,074

Total	$	24,608,110	$	22,755	$	—	$	24,630,865

See notes to financial statements.


30		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Statements of Assets and Liabilities

iSHARES^® U.S. ETF TRUST

July 31, 2016


	iShares Enhanced International Large-Cap ETF			iShares Enhanced International Small-Cap ETF			iShares Enhanced U.S. Large-Cap ETF

ASSETS
Investments, at cost:
Unaffiliated	$	37,972,733		$	17,526,923		$	58,057,383
Affiliated (Note 2)		14,393			21,793			40,468

Total cost of investments	$	37,987,126		$	17,548,716		$	58,097,851

Investments in securities, at fair value (Note 1):
Unaffiliated	$	32,720,218		$	19,390,376		$	65,421,622
Affiliated (Note 2)		14,393			21,793			40,468

Total fair value of investments		32,734,611			19,412,169			65,462,090
Foreign currency, at value^a		448,832			77,878			—
Cash		—			—			2,367
Receivables:
Investment securities sold		—			25,095			1,378,309
Dividends and interest		57,168			18,443			40,495
Tax reclaims		138,665			12,554			—

Total Assets		33,379,276			19,546,139			66,883,261


LIABILITIES
Payables:
Investment advisory fees (Note 2)		17,618			7,806			10,490

Total Liabilities		17,618			7,806			10,490


NET ASSETS	$	33,361,658		$	19,538,333		$	66,872,771


Net assets consist of:
Paid-in capital	$	42,771,968		$	19,176,710		$	59,843,587
Undistributed (distributions in excess of) net investment income		11,767			(7,630	)		79,634
Accumulated net realized loss		(4,170,954	)		(1,494,259	)		(414,689	)
Net unrealized appreciation (depreciation)		(5,251,123	)		1,863,512			7,364,239

NET ASSETS	$	33,361,658		$	19,538,333		$	66,872,771


Shares outstanding^b		1,500,000			800,000			1,950,000


Net asset value per share	$	22.24		$	24.42		$	34.29

^a	Cost of foreign currency: $448,015, $77,736 and $ —, respectively.

^b	No par value, unlimited number of shares authorized.

See notes to financial statements.


FINANCIAL STATEMENTS			31

Statements of Assets and Liabilities (Continued)

iSHARES^® U.S. ETF TRUST

July 31, 2016


		iShares Enhanced U.S. Small-Cap ETF

ASSETS
Investments, at cost:
Unaffiliated		$	22,352,300
Affiliated (Note 2)			87,074

Total cost of investments		$	22,439,374

Investments in securities, at fair value (including securities on loan^a) (Note 1):
Unaffiliated		$	24,543,791
Affiliated (Note 2)			87,074

Total fair value of investments			24,630,865
Receivables:
Dividends and interest			57,703

Total Assets			24,688,568


LIABILITIES	��
Payables:
Collateral for securities on loan (Note 1)			6,510
Investment advisory fees (Note 2)			7,570

Total Liabilities			14,080


NET ASSETS		$	24,674,488


Net assets consist of:
Paid-in capital		$	22,897,643
Undistributed net investment income			55,737
Accumulated net realized loss			(470,383	)
Net unrealized appreciation			2,191,491

NET ASSETS		$	24,674,488


Shares outstanding^b			750,000


Net asset value per share		$	32.90

^a	Securities on loan with a value of $6,370. See Note 1.

^b	No par value, unlimited number of shares authorized.

See notes to financial statements.


32		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Statements of Operations

iSHARES^® U.S. ETF TRUST

Year ended July 31, 2016


	iShares Enhanced International Large-Cap ETF			iShares Enhanced International Small-Cap ETF			iShares Enhanced U.S. Large-Cap ETF

NET INVESTMENT INCOME
Dividends — unaffiliated^a	$	2,069,137		$	368,961		$	1,584,205
Dividends — affiliated (Note 2)		165			43			309
Securities lending income — affiliated — net (Note 2)		879			23,157			17,980

Total investment income		2,070,181			392,161			1,602,494


EXPENSES
Investment advisory fees (Note 2)		224,537			76,924			136,355

Total expenses		224,537			76,924			136,355

Net investment income		1,845,644			315,237			1,466,139


NET REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from:
Investments — unaffiliated		(1,980,290	)		(801,997	)		95,659
In-kind redemptions — unaffiliated		(526,441	)		—			4,047,712
Foreign currency transactions		4,765			3,077			—

Net realized gain (loss)		(2,501,966	)		(798,920	)		4,143,371

Net change in unrealized appreciation/depreciation on:
Investments		(5,872,569	)		1,682,840			(1,992,822	)
Translation of assets and liabilities in foreign currencies		3,546			560			—

Net change in unrealized appreciation/depreciation		(5,869,023	)		1,683,400			(1,992,822	)

Net realized and unrealized gain (loss)		(8,370,989	)		884,480			2,150,549

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	(6,525,345	)	$	1,199,717		$	3,616,688

^a	Net of foreign withholding tax of $213,122, $43,242 and $ —, respectively.

See notes to financial statements.


FINANCIAL STATEMENTS			33

Statements of Operations (Continued)

iSHARES^® U.S. ETF TRUST

Year ended July 31, 2016


	iShares Enhanced U.S. Small-Cap ETF

NET INVESTMENT INCOME
Dividends — unaffiliated	$	463,431
Dividends — affiliated (Note 2)		135
Securities lending income — affiliated — net (Note 2)		28,015

Total investment income		491,581


EXPENSES
Investment advisory fees (Note 2)		82,409

Total expenses		82,409

Net investment income		409,172


NET REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from:
Investments — unaffiliated		126,572
In-kind redemptions — unaffiliated		642,556

Net realized gain		769,128

Net change in unrealized appreciation/depreciation		19,148

Net realized and unrealized gain		788,276

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	1,197,448

See notes to financial statements.


34		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Statements of Changes in Net Assets

iSHARES^® U.S. ETF TRUST


	iShares Enhanced International Large-Cap ETF						iShares Enhanced International Small-Cap ETF
	Year ended July 31, 2016			Year ended July 31, 2015			Year ended July 31, 2016			Year ended July 31, 2015

INCREASE (DECREASE) IN NET ASSETS

OPERATIONS:
Net investment income	$	1,845,644		$	1,970,264		$	315,237		$	261,166
Net realized loss		(2,501,966	)		(2,309,239	)		(798,920	)		(629,519	)
Net change in unrealized appreciation/depreciation		(5,869,023	)		11,017			1,683,400			216,875

Net increase (decrease) in net assets resulting from operations		(6,525,345	)		(327,958	)		1,199,717			(151,478	)


DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income		(1,912,879	)		(1,946,711	)		(326,068	)		(287,196	)

Total distributions to shareholders		(1,912,879	)		(1,946,711	)		(326,068	)		(287,196	)


CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold		11,344,979			54,822,179			4,658,618			4,567,025
Cost of shares redeemed		(52,668,102	)		—			—			—

Net increase (decrease) in net assets from capital share transactions		(41,323,123	)		54,822,179			4,658,618			4,567,025

INCREASE (DECREASE) IN NET ASSETS		(49,761,347	)		52,547,510			5,532,267			4,128,351

NET ASSETS
Beginning of year		83,123,005			30,575,495			14,006,066			9,877,715

End of year	$	33,361,658		$	83,123,005		$	19,538,333		$	14,006,066

Undistributed (distributions in excess of) net investment income included in net assets at end of year	$	11,767		$	46,307		$	(7,630	)	$	(6,885	)


SHARES ISSUED AND REDEEMED
Shares sold		500,000			2,200,000			200,000			200,000
Shares redeemed		(2,400,000	)		—			—			—

Net increase (decrease) in shares outstanding		(1,900,000	)		2,200,000			200,000			200,000

See notes to financial statements.


FINANCIAL STATEMENTS			35

Statements of Changes in Net Assets (Continued)

iSHARES^® U.S. ETF TRUST


	iShares Enhanced U.S. Large-Cap ETF						iShares Enhanced U.S. Small-Cap ETF
	Year ended July 31, 2016			Year ended July 31, 2015			Year ended July 31, 2016			Year ended July 31, 2015

INCREASE (DECREASE) IN NET ASSETS

OPERATIONS:
Net investment income	$	1,466,139		$	1,384,522		$	409,172		$	361,722
Net realized gain (loss)		4,143,371			1,387,233			769,128			(563,172	)
Net change in unrealized appreciation/depreciation		(1,992,822	)		5,474,233			19,148			2,127,663

Net increase in net assets resulting from operations		3,616,688			8,245,988			1,197,448			1,926,213


DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income		(1,504,471	)		(1,346,033	)		(380,435	)		(344,193	)

Total distributions to shareholders		(1,504,471	)		(1,346,033	)		(380,435	)		(344,193	)


CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold		9,690,504			21,862,919			1,462,916			10,767,793
Cost of shares redeemed		(22,736,734	)		(7,983,323	)		(3,142,565	)		—

Net increase (decrease) in net assets from capital share transactions		(13,046,230	)		13,879,596			(1,679,649	)		10,767,793

INCREASE (DECREASE) IN NET ASSETS		(10,934,013	)		20,779,551			(862,636	)		12,349,813

NET ASSETS
Beginning of year		77,806,784			57,027,233			25,537,124			13,187,311

End of year	$	66,872,771		$	77,806,784		$	24,674,488		$	25,537,124

Undistributed net investment income included in net assets at end of year	$	79,634		$	117,966		$	55,737		$	27,000


SHARES ISSUED AND REDEEMED
Shares sold		300,000			700,000			50,000			350,000
Shares redeemed		(700,000	)		(250,000	)		(100,000	)		—

Net increase (decrease) in shares outstanding		(400,000	)		450,000			(50,000	)		350,000

See notes to financial statements.


36		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Financial Highlights

iSHARES^® U.S. ETF TRUST

(For a share outstanding throughout each period)


						iShares Enhanced International Large-Cap ETF


	Year ended Jul. 31, 2016			Year ended Jul. 31, 2015			Period from Feb. 25, 2014^a to Jul. 31, 2014
Net asset value, beginning of period	$	24.45		$	25.48		$	24.90

Income from investment operations:
Net investment income^b		0.65			0.75			0.56
Net realized and unrealized gain (loss)^c		(2.21	)		(1.17	)		0.40

Total from investment operations		(1.56	)		(0.42	)		0.96

Less distributions from:
Net investment income		(0.65	)		(0.61	)		(0.38	)

Total distributions		(0.65	)		(0.61	)		(0.38	)

Net asset value, end of period	$	22.24		$	24.45		$	25.48


Total return		(6.35	)%		(1.59	)%		3.80	%^d


Ratios/Supplemental data:
Net assets, end of period (000s)	$	33,362		$	83,123		$	30,575
Ratio of expenses to average net assets^e		0.35	%		0.35	%		0.35	%
Ratio of net investment income to average net assets^e		2.88	%		3.11	%		5.04	%
Portfolio turnover rate^f		32	%		41	%		20	%

^a	Commencement of operations.

^b	Based on average shares outstanding throughout each period.

^c	The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities.

^d	Not annualized.

^e	Annualized for periods of less than one year.

^f	Portfolio turnover rates exclude portfolio securities received or delivered as a result of processing capital share transactions in Creation Units.

See notes to financial statements.


FINANCIAL HIGHLIGHTS			37

Financial Highlights (Continued)

iSHARES^® U.S. ETF TRUST

(For a share outstanding throughout each period)


						iShares Enhanced International Small-Cap ETF


	Year ended Jul. 31, 2016			Year ended Jul. 31, 2015			Period from Feb. 25, 2014^a to Jul. 31, 2014
Net asset value, beginning of period	$	23.34		$	24.69		$	24.87

Income from investment operations:
Net investment income^b		0.46			0.60			0.34
Net realized and unrealized gain (loss)^c		1.05			(1.32	)		(0.29	)

Total from investment operations		1.51			(0.72	)		0.05

Less distributions from:
Net investment income		(0.43	)		(0.63	)		(0.23	)

Total distributions		(0.43	)		(0.63	)		(0.23	)

Net asset value, end of period	$	24.42		$	23.34		$	24.69


Total return		6.62	%		(2.82	)%		0.18	%^d


Ratios/Supplemental data:
Net assets, end of period (000s)	$	19,538		$	14,006		$	9,878
Ratio of expenses to average net assets^e		0.49	%		0.49	%		0.49	%
Ratio of net investment income to average net assets^e		2.01	%		2.57	%		3.20	%
Portfolio turnover rate^f		30	%		61	%		17	%

^a	Commencement of operations.

^b	Based on average shares outstanding throughout each period.

^c	The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities.

^d	Not annualized.

^e	Annualized for periods of less than one year.

^f	Portfolio turnover rates exclude portfolio securities received or delivered as a result of processing capital share transactions in Creation Units.

See notes to financial statements.


38		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Financial Highlights (Continued)

iSHARES^® U.S. ETF TRUST

(For a share outstanding throughout each period)


	iShares Enhanced U.S. Large-Cap ETF
	Year ended Jul. 31, 2016			Year ended Jul. 31, 2015			Year ended Jul. 31, 2014			Period from Apr. 16, 2013^a to Jul. 31, 2013
Net asset value, beginning of period	$	33.11		$	30.01		$	26.76		$	24.79

Income from investment operations:
Net investment income^b		0.62			0.62			0.54			0.14
Net realized and unrealized gain^c		1.17			3.08			3.19			1.89

Total from investment operations		1.79			3.70			3.73			2.03

Less distributions from:
Net investment income		(0.61	)		(0.60	)		(0.48	)		(0.06	)

Total distributions		(0.61	)		(0.60	)		(0.48	)		(0.06	)

Net asset value, end of period	$	34.29		$	33.11		$	30.01		$	26.76


Total return		5.57	%		12.40	%		14.00	%		8.19	%^d


Ratios/Supplemental data:
Net assets, end of period (000s)	$	66,873		$	77,807		$	57,027		$	12,043
Ratio of expenses to average net assets^e		0.18	%		0.18	%		0.18	%		0.18	%
Ratio of net investment income to average net assets^e		1.94	%		1.94	%		1.87	%		1.90	%
Portfolio turnover rate^f		19	%		44	%		20	%		5	%

^a	Commencement of operations.

^b	Based on average shares outstanding throughout each period.

^c	The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities.

^d	Not annualized.

^e	Annualized for periods of less than one year.

^f	Portfolio turnover rates exclude portfolio securities received or delivered as a result of processing capital share transactions in Creation Units.

See notes to financial statements.


FINANCIAL HIGHLIGHTS			39

Financial Highlights (Continued)

iSHARES^® U.S. ETF TRUST

(For a share outstanding throughout each period)


	iShares Enhanced U.S. Small-Cap ETF
	Year ended Jul. 31, 2016			Year ended Jul. 31, 2015			Year ended Jul. 31, 2014			Period from Apr. 16, 2013^a to Jul. 31, 2013
Net asset value, beginning of period	$	31.92		$	29.31		$	27.58		$	24.67

Income from investment operations:
Net investment income^b		0.52			0.57	^c		0.33			0.16
Net realized and unrealized gain^d		0.95			2.58			1.73			2.88

Total from investment operations		1.47			3.15			2.06			3.04

Less distributions from:
Net investment income		(0.49	)		(0.54	)		(0.33	)		(0.13	)

Total distributions		(0.49	)		(0.54	)		(0.33	)		(0.13	)

Net asset value, end of period	$	32.90		$	31.92		$	29.31		$	27.58


Total return		4.77	%		10.78	%		7.43	%		12.37	%^e


Ratios/Supplemental data:
Net assets, end of period (000s)	$	24,674		$	25,537		$	13,187		$	2,758
Ratio of expenses to average net assets^f		0.35	%		0.35	%		0.35	%		0.35	%
Ratio of net investment income to average net assets^f		1.74	%		1.82	%^c		1.13	%		2.09	%
Portfolio turnover rate^g		26	%		53	%		39	%		9	%

^a	Commencement of operations.

^b	Based on average shares outstanding throughout each period.

^c	Includes a special distribution from Engility Holdings Inc. Excluding such special distribution, the net investment income would have been $0.41 per share and 1.30% of average net assets.

^d	The amounts reported for a share outstanding may not accord with the change in aggregate gains and losses in securities for the fiscal period due to the timing of capital share transactions in relation to the fluctuating market values of the Fund’s underlying securities.

^e	Not annualized.

^f	Annualized for periods of less than one year.

^g	Portfolio turnover rates exclude portfolio securities received or delivered as a result of processing capital share transactions in Creation Units.

See notes to financial statements.


40		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Notes to Financial Statements

iSHARES^® U.S. ETF TRUST

iShares U.S. ETF Trust (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust was established as a Delaware statutory trust pursuant to an Agreement and Declaration of Trust dated June 21, 2011.

These financial statements relate only to the following funds (each, a “Fund,” and collectively, the “Funds”):


iShares ETF		Diversification Classification
Enhanced International Large-Cap		Non-diversified
Enhanced International Small-Cap		Non-diversified
Enhanced U.S. Large-Cap		Diversified
Enhanced U.S. Small-Cap		Diversified

Pursuant to the Trust’s organizational documents, the Funds’ officers and trustees are indemnified against certain liabilities that may arise out of the performance of their duties to the Funds. Additionally, in the normal course of business, the Funds enter into contracts with service providers that contain general indemnification clauses. The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds that have not yet occurred.

1.	*SIGNIFICANT ACCOUNTING POLICIES*

The following significant accounting policies are consistently followed by each Fund in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Each Fund is considered an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies.

SECURITY VALUATION

Each Fund’s investments are valued at fair value each day that the Fund’s listing exchange is open and, for financial reporting purposes, as of the report date should the reporting period end on a day that the Fund’s listing exchange is not open. U.S. GAAP defines fair value as the price a fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) provides oversight of the valuation of investments for the Funds. The investments of each Fund are valued pursuant to policies and procedures developed by the Global Valuation Committee and approved by the Board of Trustees of the Trust (the “Board”).

•

Equity investments traded on a recognized securities exchange are valued at that day’s last reported trade price or the official closing price, as applicable, on the exchange where the stock is primarily traded. Equity investments traded on a recognized exchange for which there were no sales on that day are valued at the last traded price.

•

Open-end U.S. mutual funds (including money market funds) are valued at that day’s published net asset value (“NAV”).

In the event that application of these methods of valuation results in a price for an investment which is deemed not to be representative of the fair value of such investment or if a price is not available, the investment will be valued based upon other available factors deemed relevant by the Global Valuation Committee, in accordance with policies approved by the Board. These


NOTESTO FINANCIAL STATEMENTS			41

Notes to Financial Statements (Continued)

iSHARES^® U.S. ETF TRUST

factors include but are not limited to (i) attributes specific to the investment; (ii) the principal market for the investment; (iii) the customary participants in the principal market for the investment; (iv) data assumptions by market participants for the investment, if reasonably available; (v) quoted prices for similar investments in active markets; and (vi) other factors, such as future cash flows, interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and/or default rates. Valuations based on such factors are reported to the Board on a quarterly basis.

The Global Valuation Committee employs various methods for calibrating valuation approaches for investments where an active market does not exist, including regular due diligence of the Trust’s pricing vendors, a regular review of key inputs and assumptions, transactional back-testing or disposition analysis to compare unrealized gains and losses to realized gains and losses, reviews of missing or stale prices, reviews of large movements in market values, and reviews of market related activity.

Various inputs are used in determining the fair value of financial instruments. Inputs may be based on independent market data (“observable inputs”) or they may be internally developed (“unobservable inputs”). These inputs are categorized into a disclosure hierarchy consisting of three broad levels for financial reporting purposes. The level of a value determined for a financial instrument within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement in its entirety. The categorization of a value determined for a financial instrument within the hierarchy is based upon the pricing transparency of the instrument and is not necessarily an indication of the risk associated with investing in the instrument. The three levels of the fair value hierarchy are as follows:

•

Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities;

•

Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset or liability either directly or indirectly, including quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not considered to be active, inputs other than quoted prices that are observable for the asset or liability (such as exchange rates, financing terms, interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs; and

•

Level 3 — Unobservable inputs for the asset or liability, including the Global Valuation Committee’s assumptions used in determining the fair value of investments.

Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. In accordance with the Trust’s policy, transfers between different levels of the fair value hierarchy are deemed to have occurred as of the beginning of the reporting period.

SECURITY TRANSACTIONS AND INCOME RECOGNITION

Security transactions are accounted for on trade date. Dividend income and capital gain distributions, if any, are recognized on the ex-dividend date, net of any foreign taxes withheld at source. Any taxes withheld that are reclaimable from foreign tax authorities as of July 31, 2016 are reflected in tax reclaims receivable. Non-cash dividends received in the form of stock in an elective dividend, if any, are recorded as dividend income at fair value. Distributions received by the Funds may include a return of capital that is estimated by management. Such amounts are recorded as a reduction of the cost of investments or reclassified to capital gains. Interest income is accrued daily. Realized gains and losses on investment transactions are determined using the specific identification method.

FOREIGN CURRENCY TRANSLATION

The accounting records of the Funds are maintained in U.S. dollars. Foreign currencies, as well as investment securities and other assets and liabilities denominated in foreign currencies, are translated into U.S. dollars using exchange rates deemed


42		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Notes to Financial Statements (Continued)

iSHARES^® U.S. ETF TRUST

appropriate by the investment adviser. Purchases and sales of securities, income receipts and expense payments are translated into U.S. dollars on the respective dates of such transactions.

Each Fund does not isolate the effect of fluctuations in foreign exchange rates from the effect of fluctuations in the market prices of securities. Such fluctuations are reflected by the Funds as a component of realized and unrealized gains and losses from investments for financial reporting purposes.

FOREIGN TAXES

Certain Funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, stock dividends, capital gains on investments, or certain foreign currency transactions. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign jurisdictions in which the Funds invest. These foreign taxes, if any, are paid by the Funds and are reflected in their statements of operations as follows: foreign taxes withheld at source are presented as a reduction of income, foreign taxes on securities lending income are presented as a reduction of securities lending income, foreign taxes on stock dividends are presented as “other foreign taxes”, and foreign taxes on capital gains from sales of investments and foreign taxes on foreign currency transactions are included in their respective net realized gain (loss) categories. Foreign taxes payable or deferred as of July 31, 2016, if any, are disclosed in the Funds’ statements of assets and liabilities.

DISTRIBUTIONS TO SHAREHOLDERS

Dividends and distributions paid by each Fund are recorded on the ex-dividend dates. Distributions are determined on a tax basis and may differ from net investment income and net realized capital gains for financial reporting purposes. Dividends and distributions are paid in U.S. dollars and cannot be automatically reinvested in additional shares of the Funds.

LOANS OF PORTFOLIO SECURITIES

Each Fund may lend its investment securities to approved borrowers, such as brokers, dealers and other financial institutions. The borrower pledges and maintains with the Fund collateral consisting of cash, an irrevocable letter of credit issued by a bank, or securities issued or guaranteed by the U.S. government. The initial collateral received by each Fund is required to have a value of at least 102% of the current value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% for all other securities. The collateral is maintained thereafter at a value equal to at least 100% of the current value of the securities on loan. The market value of the loaned securities is determined at the close of each business day of the Funds. Any additional required collateral is delivered to the Funds and any excess collateral is returned by the Funds on the next business day. During the term of the loan, each Fund is entitled to all distributions made on or in respect of the loaned securities. Loans of securities are terminable at any time and the borrower, after notice, is required to return borrowed securities within the standard time period for settlement of securities transactions.

Any cash received as collateral for securities on loan may be reinvested in certain short-term instruments either directly on behalf of a fund or through one or more joint accounts or money market funds, including those managed by BlackRock Fund Advisors (“BFA”), the Funds’ investment adviser, or its affiliates. As of July 31, 2016, any securities on loan were collateralized by cash. The cash collateral received was invested in money market funds managed by BFA and is disclosed in the schedules of investments. The securities on loan for each Fund are also disclosed in its schedule of investments. The total value of any securities on loan as of July 31, 2016 and the total value of the related collateral are disclosed in the statements of assets and liabilities. Income earned by the Funds from securities lending is disclosed in the statements of operations.

The risks of securities lending include the risk that the borrower may not provide additional collateral when required or may not return the securities when due. To mitigate these risks, the Funds benefit from a borrower default indemnity provided by


NOTESTO FINANCIAL STATEMENTS			43

Notes to Financial Statements (Continued)

iSHARES^® U.S. ETF TRUST

BlackRock, Inc. (“BlackRock”). BlackRock’s indemnity allows for full replacement of securities lent. Each Fund could suffer a loss if the value of the investments purchased with cash collateral falls below the value of the cash collateral received.

Securities lending transactions are entered into by the Funds under Master Securities Lending Agreements (“MSLA”) which provide the right, in the event of default (including bankruptcy or insolvency) for the non-defaulting party to liquidate the collateral and calculate a net exposure to the defaulting party or request additional collateral. In the event that a borrower defaults, a Fund, as lender, would offset the market value of the collateral received against the market value of the securities loaned. The value of the collateral is typically greater than that of the market value of the securities loaned, leaving the lender with a net amount payable to the defaulting party. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of an MSLA counterparty’s bankruptcy or insolvency. Under the MSLA, the borrower can resell or re-pledge the loaned securities, and a Fund can reinvest cash collateral, or, upon an event of default, resell or re-pledge the collateral.

The following table is a summary of securities lending agreements which are subject to offset under an MSLA as of July 31, 2016:


iShares ETF and Counterparty	Market Value of Securities on Loan		Cash Collateral Received^a		Net Amount
Enhanced U.S. Small-Cap
Citigroup Global Markets Inc.	$	6,361	$	6,361	$	—
JPMorgan Clearing Corp.		9		9		—

	$	6,370	$	6,370	$	—

Collateral received in excess of the market value of securities on loan is not presented in this table. The total cash collateral received by the Fund is disclosed in the Fund’s statement of assets and liabilities.

2.	*INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES*

Pursuant to an Investment Advisory Agreement with the Trust, BFA manages the investment of each Fund’s assets. BFA is a California corporation indirectly owned by BlackRock. Under the Investment Advisory Agreement, BFA is responsible for substantially all expenses of the Funds, except interest, taxes, brokerage commissions and other expenses connected with the execution of portfolio transactions, distribution fees, litigation expenses and any extraordinary expenses.

For its investment advisory services to each Fund, BFA is entitled to an annual investment advisory fee based on the average daily net assets of each Fund as follows:


iShares ETF	Investment Advisory Fee
Enhanced International Large-Cap		0.35	%
Enhanced International Small-Cap		0.49
Enhanced U.S. Large-Cap		0.18
Enhanced U.S. Small-Cap		0.35

The SEC has issued an exemptive order which permits BlackRock Institutional Trust Company, N.A. (“BTC”), an affiliate of BFA, to serve as securities lending agent for the Funds, subject to applicable conditions. As securities lending agent, BTC bears all operational costs directly related to securities lending. Each Fund is responsible for fees in connection with the investment of cash collateral received for securities on loan in a money market fund managed by BFA, however, BTC has agreed to reduce the amount of securities lending income it receives in order to effectively limit the collateral investment fees each Fund bears to an


44		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Notes to Financial Statements (Continued)

iSHARES^® U.S. ETF TRUST

annual rate of 0.04% (the “collateral investment fees”). Securities lending income is equal to the total of income earned from the reinvestment of cash collateral, net of fees and other payments to and from borrowers of securities, and less the collateral investment fees. The Funds retain a portion of securities lending income and remit the remaining portion to BTC as compensation for its services as securities lending agent.

Pursuant to a securities lending agreement, the iShares Enhanced U.S. Large-Cap ETF and iShares Enhanced U.S. Small-Cap ETF (the “Group 1 Funds”), retain 71.5% of securities lending income and the amount retained can never be less than 65% of the total of securities lending income plus the collateral investment fees.

Pursuant to a securities lending agreement, the iShares Enhanced International Large-Cap ETF and iShares Enhanced International Small-Cap ETF (the “Group 2 Funds”), retain 80% of securities lending income and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.

In addition, commencing the business day following the date that the aggregate securities lending income plus the collateral investment fees generated across all 1940 Act iShares exchange-traded funds (the “iShares ETF Complex”) in a given calendar year exceeds the aggregate securities lending income generated across the iShares ETF Complex in the calendar year 2013, each Group 1 Fund, pursuant to a securities lending agreement, will retain for the remainder of that calendar year 75% of securities lending income and the amount retained can never be less than 65% of the total of securities lending income plus the collateral investment fees. Each Group 2 Fund will receive for the remainder of that calendar year 85% of securities lending income and the amount retained can never be less than 70% of the total of securities lending income plus the collateral investment fees.

For the year ended July 31, 2016, the total of securities lending agent services and collateral investment fees paid were as follows:


iShares ETF	Fees Paid to BTC
Enhanced International Large-Cap	$	213
Enhanced International Small-Cap		5,755
Enhanced U.S. Large-Cap		7,373
Enhanced U.S. Small-Cap		11,832

BlackRock Investments, LLC, an affiliate of BFA, is the distributor for each Fund. Pursuant to the distribution agreement, BFA is responsible for any fees or expenses for distribution services provided to the Funds.

Each Fund may invest its positive cash balances in certain money market funds managed by BFA or an affiliate. The income earned on these temporary cash investments is included in “Dividends – affiliated” in the statements of operations.

The PNC Financial Services Group, Inc. is the largest stockholder of BlackRock and is considered to be an affiliate of the Funds for 1940 Act purposes.

Certain trustees and officers of the Trust are also officers of BTC and/or BFA.


NOTESTO FINANCIAL STATEMENTS			45

Notes to Financial Statements (Continued)

iSHARES^® U.S. ETF TRUST

3.	*INVESTMENT PORTFOLIO TRANSACTIONS*

Purchases and sales of investments (excluding in-kind transactions and short-term investments) for the year ended July 31, 2016 were as follows:


iShares ETF	Purchases		Sales
Enhanced International Large-Cap	$	19,836,550	$	22,101,528
Enhanced International Small-Cap		4,787,762		4,680,496
Enhanced U.S. Large-Cap		14,002,658		14,789,135
Enhanced U.S. Small-Cap		6,511,310		6,221,511

In-kind transactions (see Note 4) for the year ended July 31, 2016 were as follows:


iShares ETF	In-kind Purchases		In-kind Sales
Enhanced International Large-Cap	$	11,102,379	$	50,490,547
Enhanced International Small-Cap		4,548,551		—
Enhanced U.S. Large-Cap		9,619,108		22,380,501
Enhanced U.S. Small-Cap		1,421,349		3,072,624

4.	*CAPITAL SHARE TRANSACTIONS*

Capital shares are issued and redeemed by each Fund only in aggregations of a specified number of shares or multiples thereof (“Creation Units”) at NAV. Except when aggregated in Creation Units, shares of each Fund are not redeemable. Transactions in capital shares for each Fund are disclosed in detail in the statements of changes in net assets.

The consideration for the purchase of Creation Units of a fund in the Trust generally consists of the in-kind deposit of a designated portfolio of securities and a specified amount of cash. Certain funds in the Trust may be offered in Creation Units solely or partially for cash in U.S. dollars. Investors purchasing and redeeming Creation Units may pay a purchase transaction fee and a redemption transaction fee directly to State Street Bank and Trust Company, the Trust’s administrator, to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units, including Creation Units for cash. Investors transacting in Creation Units for cash may also pay an additional variable charge to compensate the relevant fund for certain transaction costs (i.e., stamp taxes, taxes on currency or other financial transactions, and brokerage costs) and market impact expenses relating to investing in portfolio securities. Such variable charges, if any, are included in “Proceeds from shares sold” in the statements of changes in net assets.

5.	*PRINCIPAL RISKS*

In the normal course of business, each Fund’s investment activities expose it to various types of risk associated with the financial instruments and markets in which it invests. The significant types of financial risks each Fund is exposed to include market risk and credit risk. Each Fund’s prospectus provides details of these and other types of risk.

MARKET RISK

Market risk arises mainly from uncertainty about future values of financial instruments influenced by price, currency and interest rate movements. It represents the potential loss each Fund may suffer through holding market positions in the face of market movements. Each Fund is exposed to market risk by virtue of its direct and/or indirect investment in equity instruments. The fair


46		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Notes to Financial Statements (Continued)

iSHARES^® U.S. ETF TRUST

value of securities held by the Funds may decline due to general market conditions, economic trends or events that are not specifically related to the issuers of the securities including local, regional or global political, social or economic instability or to factors that affect a particular industry or group of industries. The extent of each Fund’s exposure to market risk is the market value of the investments held as shown in the Fund’s schedule of investments.

A diversified portfolio, where this is appropriate and consistent with a fund’s objectives, minimizes the risk that a price change of a particular investment will have a material impact on the NAV of a fund. The investment concentrations within each Fund’s portfolio are disclosed in its schedule of investments.

Investing in the securities of non-U.S. issuers, whether directly or indirectly, involves certain considerations and risks not typically associated with securities of U.S. issuers. Such risks include, but are not limited to: generally less liquid and less efficient securities markets; generally greater price volatility; exchange rate fluctuations and exchange controls; imposition of restrictions on the expatriation of funds or other assets of the Fund; less publicly available information about issuers; the imposition of withholding or other taxes; higher transaction and custody costs; settlement delays and risk of loss attendant in settlement procedures; difficulties in enforcing contractual obligations; less regulation of securities markets; different accounting, disclosure and reporting requirements; more substantial governmental involvement in the economy; higher inflation rates; greater social, economic and political uncertainties; the risk of nationalization or expropriation of assets; and the risk of war. These risks are heightened for investments in issuers from countries with less developed markets.

The economies and markets of European countries are often closely connected and interdependent, and events in one European country can have an adverse impact on other European countries. The European financial markets have experienced volatility and adverse trends due to concerns about economic downturns in, or rising government debt levels of several European countries. Responses to the financial problems by European governments, central banks and others, including austerity measures and reforms, may not work, may result in social unrest and may limit future growth and economic recovery or have other unintended consequences. Further defaults or restructurings by governments and others of their debt could have additional adverse effects on economies, financial markets and asset valuations around the world. In addition, the United Kingdom has voted to withdraw from the European Union. The referendum may introduce significant new uncertainties and instability in the financial markets as the United Kingdom negotiates its exit from the European Union.

CREDIT RISK

Credit risk is the risk that an issuer or guarantor of debt instruments or the counterparty to a financial transaction, including derivatives contracts, repurchase agreements or loans of portfolio securities, is unable or unwilling to make timely interest and/or principal payments or to otherwise honor its obligations. BFA and its affiliates manage counterparty credit risk by entering into transactions only with counterparties that they believe have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Funds to issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of each Fund’s exposure to credit and counterparty risks with respect to those financial assets is approximated by their value recorded in its statement of assets and liabilities.

6.	*INCOME TAX INFORMATION*

Each Fund is treated as an entity separate from the Trust’s other funds for federal income tax purposes. It is the policy of each Fund to qualify as a regulated investment company by complying with the provisions applicable to regulated investment companies, as defined under Subchapter M of the Internal Revenue Code of 1986, as amended, and to annually distribute substantially all of its ordinary income and any net capital gains (taking into account any capital loss carryforwards) sufficient to relieve it from all, or substantially all, federal income and excise taxes. Accordingly, no provision for federal income taxes is required.


NOTESTO FINANCIAL STATEMENTS			47

Notes to Financial Statements (Continued)

iSHARES^® U.S. ETF TRUST

U.S. GAAP requires that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or NAV per share. The following permanent differences as of July 31, 2016, attributable to passive foreign investment companies, foreign currency transactions and realized gains (losses) from in-kind redemptions, were reclassified to the following accounts:


iShares ETF	Paid-in Capital			Undistributed Net Investment Income/Distributions in Excess of Net Investment Income		Undistributed Net Realized Gain/Accumulated Net Realized Loss
Enhanced International Large-Cap	$	(731,270	)	$	32,695	$	698,575
Enhanced International Small-Cap		—			10,086		(10,086	)
Enhanced U.S. Large-Cap		3,977,841			—		(3,977,841	)
Enhanced U.S. Small-Cap		626,251			—		(626,251	)

The tax character of distributions paid during the years ended July 31, 2016 and July 31, 2015 was as follows:


iShares ETF	2016		2015
Enhanced International Large-Cap
Ordinary income	$	1,912,879	$	1,946,711


Enhanced International Small-Cap
Ordinary income	$	326,068	$	287,196


Enhanced U.S. Large-Cap
Ordinary income	$	1,504,471	$	1,346,033


Enhanced U.S. Small-Cap
Ordinary income	$	380,435	$	344,193

As of July 31, 2016, the tax components of accumulated net earnings (losses) were as follows:


iShares ETF	Undistributed Ordinary Income		Capital Loss Carryforwards			Net Unrealized Gains (Losses)^a			Qualified Late-Year Losses^b			Total
Enhanced International Large-Cap	$	77,453	$	(2,520,004	)	$	(5,393,374	)	$	(1,574,385	)	$	(9,410,310	)
Enhanced International Small-Cap		121,260		(866,160	)		1,689,618			(583,095	)		361,623
Enhanced U.S. Large-Cap		79,634		—			7,294,668			(345,118	)		7,029,184
Enhanced U.S. Small-Cap		55,737		(333,291	)		2,173,788			(119,389	)		1,776,845

The difference between book-basis and tax-basis unrealized gains (losses) was attributable primarily to the tax deferral of losses on wash sales and the realization for tax purposes of unrealized gains on investments in passive foreign investment companies.

The Funds have elected to defer certain qualified late-year losses and recognize such losses in the next taxable year.


48		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Notes to Financial Statements (Continued)

iSHARES^® U.S. ETF TRUST

As of July 31, 2016, the following Funds had non-expiring capital loss carryforwards available to offset future realized capital gains as follows:


iShares ETF	Non- Expiring
Enhanced International Large-Cap	$	2,520,004
Enhanced International Small-Cap		866,160
Enhanced U.S. Small-Cap		333,291

For the year ended July 31, 2016 the iShares Enhanced U.S. Large Cap ETF utilized $237,466 of its capital loss carryforwards.

The Funds may own shares in certain foreign investment entities, referred to, under U.S. tax law, as “passive foreign investment companies.” The Funds may elect to mark-to-market annually the shares of each passive foreign investment company and would be required to distribute to shareholders any such marked-to-market gains.

Management has analyzed tax laws and regulations and their application to the Funds as of July 31, 2016, inclusive of the open tax return years, and does not believe there are any uncertain tax positions that require recognition of a tax liability in the Funds’ financial statements.

7.	*SUBSEQUENT EVENTS*

Management has evaluated the impact of all subsequent events on the Funds through the date the financial statements were available to be issued and has determined that there were no subsequent events requiring adjustment or disclosure in the financial statements, except as noted below.

On June 23, 2016, the Board unanimously voted to close and liquidate the Funds. After the close of business on August 23, 2016, subject to applicable law, the Funds no longer accepted creation orders. Trading in the Funds was halted prior to market open on August 24, 2016. Proceeds of the liquidation were sent to shareholders on August 30, 2016.


NOTESTO FINANCIAL STATEMENTS			49

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Trustees of

iShares U.S. ETF Trust:

In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of iShares Enhanced International Large-Cap ETF, iShares Enhanced International Small-Cap ETF, iShares Enhanced U.S. Large-Cap ETF and iShares Enhanced U.S. Small-Cap ETF (the “Funds”) at July 31, 2016, the results of each of their operations, the changes in each of their net assets and their financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at July 31, 2016 by correspondence with the custodian, transfer agent and brokers, provide a reasonable basis for our opinion.

As discussed in Note 7, the Board of Trustees approved the liquidation of the Funds, which occurred on August 30, 2016.

PricewaterhouseCoopers LLP

San Francisco, California

September 26, 2016


50		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Tax Information (Unaudited)

iSHARES^® U.S. ETF TRUST

The following maximum amounts are hereby designated as qualified dividend income for individuals for the fiscal year ended July 31, 2016:


iShares ETF	Qualified Dividend Income
Enhanced International Large-Cap	$	2,215,889
Enhanced International Small-Cap		329,018
Enhanced U.S. Large-Cap		1,592,299
Enhanced U.S. Small-Cap		370,661

For corporate shareholders, the percentage of income dividends paid during the fiscal year ended July 31, 2016 that qualified for the dividends-received deduction were as follows:


iShares ETF	Dividends- Received Deduction
Enhanced U.S. Large-Cap		96.03	%
Enhanced U.S. Small-Cap		86.86	%

For the fiscal year ended July 31, 2016, the following Funds earned foreign source income and paid foreign taxes which they intend to pass through to their shareholders:


iShares ETF	Foreign Source Income Earned		Foreign Taxes Paid
Enhanced International Large-Cap	$	2,282,259	$	213,122
Enhanced International Small-Cap		412,203		43,069


TAX INFORMATION			51

Board Review and Approval on Investment Advisory

Contract

iSHARES^® U.S. ETF TRUST

I. iShares Enhanced International Large-Cap ETF, iShares Enhanced U.S. Large-Cap ETF and iShares Enhanced U.S. Small-Cap ETF

Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Trustees who are not “interested persons” of the Trust (as that term is defined in the 1940 Act) (the “Independent Trustees”), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) on behalf of the Funds. The Independent Trustees requested, and BFA provided, such information as the Independent Trustees, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. A committee of all of the Independent Trustees (the “15(c) Committee”), with independent counsel, met with management on April 28, 2016 and May 9, 2016. At these meetings, the 15(c) Committee reviewed and discussed information provided in response to the 15(c) Committee’s initial requests, and requested certain additional information, which management agreed to provide. At a meeting held on May 17, 2016, management presented information to the Board relating to the continuance of the Advisory Contract, including information requested by the 15(c) Committee during its meetings. The Board, including the Independent Trustees, reviewed and discussed such information at length. The Independent Trustees requested from management certain additional information, which management agreed to provide. At a meeting held on June 21-23, 2016, the Board, including the Independent Trustees, reviewed the additional information provided by management in response to these requests. After extensive discussions, the Board, including all of the Independent Trustees, approved the continuance of the Advisory Contract for the Funds, based on a review of qualitative and quantitative information provided by BFA, including the additional information management provided at the request of the Independent Trustees. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Board also noted that the Board and BFA agreed to discuss potential enhancements and adjustments to the 15(c) process for the coming year. The Independent Trustees were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the Advisory Contract for the Funds, the Board, including the Independent Trustees, considered the following factors, no one of which was controlling, and reached the following conclusions:

Expenses and Performance of the Funds — The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, waivers/reimbursements (if any), and underlying fund fees and expenses (if any) of each Fund in comparison with the same information for other exchange traded funds (including, where applicable, funds sponsored by an “at cost” service provider) and, in the limited instances where no comparable ETFs existed and the comparison group would not otherwise be reasonable in Broadridge’s judgment, pure index institutional mutual funds, objectively selected by Broadridge as comprising such Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of Broadridge’s proprietary ETF methodology used by Broadridge to determine the applicable Peer Groups. The Board further noted that due to the limitations in providing comparable funds in the various Peer Groups, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Funds in all instances.

The Board also noted that the investment advisory fee rates and overall expenses (net of waivers and reimbursements) for the Funds were lower than the median of the investment advisory fee rates and overall expenses (net of waivers and reimbursements) of the funds in their respective Peer Group, excluding iShares funds.

In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as any particular Fund, Broadridge also provided, and the Board reviewed, a comparison of such Fund’s performance for the one-, three-, five-, ten-year, and since inception periods, as applicable, and for the “last quarter” period ended December 31, 2015, to that of such relevant comparison funds for the same periods.


52		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Board Review and Approval on Investment Advisory

Contract (Continued)

iSHARES^® U.S. ETF TRUST

The Board noted that each Fund is an actively managed ETF that does not seek to track the performance of a specified index and that the management team for each Fund manages the Fund’s portfolio in accordance with its investment objective. The Board further noted that during the prior year, the Board received periodic reports on each Fund’s short- and longer-term performance in comparison with its peer group and benchmark index. Such periodic comparative performance information, including additional detailed information on certain specific iShares funds requested by the Board, was also considered. The Board noted that each Fund generally performed in line with expectations relative to each Fund’s peer group and benchmark index.

Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of each Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.

Nature, Extent and Quality of Services Provided by BFA — Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, product design and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared to the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to supporting the iShares funds and their shareholders. The Board also considered BFA’s compliance program and its compliance record with respect to the Funds. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made appropriate officers available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Funds, as well as the resources available to them in managing the Funds. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies provided at the June 21-23, 2016 meeting and throughout the previous year, and matters related to BFA’s portfolio compliance policies and procedures. The Board noted that each Fund had met its investment objective consistently since its respective inception date.

Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided by BFA to the Funds under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.

Costs of Services Provided to the Funds and Profits Realized by BFA and its Affiliates — The Board reviewed information about the profitability to BlackRock of the Funds, on a Fund-by-Fund basis and in the aggregate, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and all other sources of revenue and expense to BFA and its affiliates from the Funds’ operations for the last calendar year. The Board reviewed BlackRock’s profitability methodology for the iShares funds, noting that the 15(c) Committee had focused on the methodology and profitability presentation during its meetings. The Board discussed the sources of direct and ancillary revenue with management, including the revenues to BTC from securities lending by the Funds. The Board also discussed BFA’s profit margin as reflected in the Funds’ profitability analyses and reviewed information regarding potential economies of scale (as discussed below). Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Funds and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors considered.

Economies of Scale — The Board reviewed information regarding potential economies of scale or other efficiencies that may result from increases in the Funds’ assets, noting that the issue of economies of scale had been focused on extensively by the 15(c) Committee during its meetings and addressed by management. The Board and the 15(c) Committee reviewed information


BOARD REVIEWAND APPROVALON INVESTMENT ADVISORY CONTRACT			53

Board Review and Approval on Investment Advisory

Contract (Continued)

iSHARES^® U.S. ETF TRUST

provided by BFA regarding scale benefits shared with the iShares funds through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board and the 15(c) Committee received information regarding BlackRock’s historical profitability, including BFA’s and its affiliates’ costs in providing services. The cost information distinguished, among other things, between fixed and variable costs, and explained how the level of fixed and variable costs, as well as the nature of such costs, may impact the existence or size of scale benefits. The Board noted that the Advisory Contract for the Funds did not provide for any breakpoints in the Funds’ investment advisory fee rates as the assets of the Funds increase. However, the Board noted that should material economies of scale exist in the future that are not otherwise shared, a breakpoint structure for the Funds may be appropriate, and that it would continue to monitor the sharing of economies of scale to determine the appropriateness of adding breakpoints in the future.

Based on this review, as well as the other factors considered at the meeting, the Board, recognizing its responsibility to consider this issue periodically, determined to approve the continuance of the Advisory Contract for the coming year.

Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates — The Board received and considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (together, the “Other Accounts”), and acknowledged BFA’s assertion that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do manage Other Accounts with similar investment strategies or investment mandates as the Funds. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts (particularly institutional clients) generally differ from the Funds, including in terms of the different and generally more extensive services provided to the Funds, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Funds, as publicly traded exchange traded funds, as compared to the Other Accounts that are institutional clients in light of differing regulatory requirements and client-imposed mandates. The Board also considered the “all-inclusive” nature of the Funds’ advisory fee structure, and the Fund expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rates under the Advisory Contract for the Funds were generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.

Other Benefits to BFA and/or its Affiliates — The Board reviewed the “fallout” benefits or ancillary revenue received by BFA and/or its affiliates in connection with the services provided to the Funds by BFA, such as payment of revenue to BTC, the Funds’ securities lending agent, for loaning portfolio securities (which was included in the profit margins reviewed by the Board pursuant to BFA’s profitability methodology), and payment of advisory fees and/or administration fees to BFA and BTC (or their affiliates) in connection with any investments by the Funds in other funds for which BFA (or its affiliates) provides investment advisory services and/or administration services. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Funds. The Board further noted that any portfolio transactions on behalf of the Funds placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates, are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Funds’ shareholders and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.


54		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Board Review and Approval on Investment Advisory

Contract (Continued)

iSHARES^® U.S. ETF TRUST

Based on the considerations described above, the Board determined that each Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded that it is in the best interest of each Fund and its shareholders to approve the continuance of the Advisory Contract for the coming year.

At the June 21-23, 2016 meeting, BFA sought approval from the Board to close and liquidate the Funds in the third quarter of 2016. BFA noted to the Board, among other things, that the Funds had generated limited interest since their launch and did not have favorable prospects to achieve scale, and the Board unanimously voted to close and liquidate the Funds.

II. iShares Enhanced International Small-Cap ETF

Under Section 15(c) of the Investment Company Act of 1940 (the “1940 Act”), the Trust’s Board of Trustees (the “Board”), including a majority of Trustees who are not “interested persons” of the Trust (as that term is defined in the 1940 Act) (the “Independent Trustees”), is required annually to consider and approve the Investment Advisory Contract between the Trust and BFA (the “Advisory Contract”) on behalf of the Fund. The Independent Trustees requested, and BFA provided, such information as the Independent Trustees, with advice from independent counsel, deemed reasonably necessary to evaluate the Advisory Contract. A committee of all of the Independent Trustees (the “15(c) Committee”), with independent counsel, met with management on April 28, 2016 and May 9, 2016. At these meetings, the 15(c) Committee reviewed and discussed information provided in response to the 15(c) Committee’s initial requests, and requested certain additional information, which management agreed to provide. At a meeting held on May 17, 2016, management presented information to the Board relating to the continuance of the Advisory Contract, including information requested by the 15(c) Committee during its meetings. The Board, including the Independent Trustees, reviewed and discussed such information at length. The Independent Trustees requested from management certain additional information, which management agreed to provide. At a meeting held on June 21-23, 2016, the Board, including the Independent Trustees, reviewed the additional information provided by management in response to these requests. After extensive discussions, the Board, including all of the Independent Trustees, approved the continuance of the Advisory Contract for the Fund, based on a review of qualitative and quantitative information provided by BFA, including the additional information management provided at the request of the Independent Trustees. The Board noted its satisfaction with the extent and quality of information provided and its frequent interactions with management, as well as the detailed responses and other information provided by BFA. The Board also noted that the Board and BFA agreed to discuss potential enhancements and adjustments to the 15(c) process for the coming year. The Independent Trustees were advised by their independent counsel throughout the process, including about the legal standards applicable to their review. In approving the Advisory Contract for the Fund, the Board, including the Independent Trustees, considered the following factors, no one of which was controlling, and reached the following conclusions:

Expenses and Performance of the Fund — The Board reviewed statistical information prepared by Broadridge Financial Solutions Inc. (“Broadridge”), an independent provider of investment company data, regarding the expense ratio components, including gross and net total expenses, waivers/reimbursements (if any), and underlying fund fees and expenses (if any) of the Fund in comparison with the same information for other exchange traded funds (including, where applicable, funds sponsored by an “at cost” service provider) and, in the limited instances where no comparable ETFs existed and the comparison group would not otherwise be reasonable in Broadridge’s judgment, pure index institutional mutual funds, objectively selected by Broadridge as comprising the Fund’s applicable peer group pursuant to Broadridge’s proprietary ETF methodology (the “Peer Group”). The Board was provided with a detailed description of Broadridge’s proprietary ETF methodology used by Broadridge to determine the Fund’s Peer Group. The Board further noted that due to the limitations in providing comparable funds in the Peer Group, the statistical information provided in Broadridge’s report may or may not provide meaningful direct comparisons to the Fund in all instances.


BOARD REVIEWAND APPROVALON INVESTMENT ADVISORY CONTRACT			55

Board Review and Approval on Investment Advisory

Contract (Continued)

iSHARES^® U.S. ETF TRUST

The Board also noted that the investment advisory fee rate and overall expenses (net of waivers and reimbursements) for the Fund were lower than the median of the investment advisory fee rates and overall expenses (net of waivers and reimbursements) of the funds in its Peer Group, excluding iShares funds.

In addition, to the extent that any of the comparison funds included in the Peer Group, excluding iShares funds, track the same index as the Fund, Broadridge also provided, and the Board reviewed, a comparison of the Fund’s performance for the one-, three-, five-, ten-year, and since inception periods, as applicable, and for the “last quarter” period ended December 31, 2015, to that of such relevant comparison funds for the same periods.

The Board noted that the Fund is an actively managed ETF that does not seek to track the performance of a specified index and that the management team for the Fund manages the Fund’s portfolio in accordance with its investment objective. The Board further noted that during the prior year, the Board received periodic reports on the Fund’s short- and longer-term performance in comparison with its peer group and benchmark index. Such periodic comparative performance information, including additional detailed information on certain specific iShares funds requested by the Board, was also considered. The Board noted that the Fund generally performed in line with expectations relative to the Fund’s peer group and benchmark index over the relevant periods.

Based on this review, the other factors considered at the meeting, and their general knowledge of ETF pricing, the Board concluded that the investment advisory fee rate and expense level and the historical performance of the Fund supported the Board’s approval of the continuance of the Advisory Contract for the coming year.

Nature, Extent and Quality of Services Provided by BFA — Based on management’s representations, including information about recent and proposed enhancements to the iShares business, including with respect to capital markets support and analysis, product design and other services, the Board expected that there would be no diminution in the scope of services required of or provided by BFA under the Advisory Contract for the coming year as compared to the scope of services provided by BFA during prior years. In reviewing the scope of these services, the Board considered BFA’s investment philosophy and experience, noting that BFA and its affiliates have committed significant resources over time, including during the past year, to supporting the iShares funds and their shareholders. The Board also considered BFA’s compliance program and its compliance record with respect to the Fund. In that regard, the Board noted that BFA reports to the Board about portfolio management and compliance matters on a periodic basis in connection with regularly scheduled meetings of the Board, and on other occasions as necessary and appropriate, and has provided information and made appropriate officers available as needed to provide further assistance with these matters. The Board also reviewed the background and experience of the persons responsible for the day-to-day management of the Fund, as well as the resources available to them in managing the Fund. In addition to the above considerations, the Board reviewed and considered detailed presentations regarding BFA’s investment performance, investment and risk management processes and strategies provided at the June 21-23, 2016 meeting and throughout the previous year, and matters related to BFA’s portfolio compliance policies and procedures. The Board noted that the Fund had met its investment objective consistently since its inception date.

Based on review of this information, and the performance information discussed above, the Board concluded that the nature, extent and quality of services provided by BFA to the Fund under the Advisory Contract supported the Board’s approval of the continuance of the Advisory Contract for the coming year.

Costs of Services Provided to the Fund and Profits Realized by BFA and its Affiliates — The Board reviewed information about the profitability to BlackRock of the Fund, based on the fees payable to BFA and its affiliates (including fees under the Advisory Contract), and all other sources of revenue and expense to BFA and its affiliates from the Funds’ operations for the last calendar year. The Board reviewed BlackRock’s profitability methodology for the iShares funds, noting that the 15(c) Committee


56		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Board Review and Approval on Investment Advisory

Contract (Continued)

iSHARES^® U.S. ETF TRUST

had focused on the methodology and profitability presentation during its meetings. The Board discussed the sources of direct and ancillary revenue with management, including the revenues to BTC from securities lending by the Fund. The Board also discussed BFA’s profit margin as reflected in the Fund’s profitability analysis and reviewed information regarding potential economies of scale (as discussed below). Based on this review, the Board concluded that the profits realized by BFA and its affiliates under the Advisory Contract and from other relationships between the Fund and BFA and/or its affiliates, if any, were within a reasonable range in light of the factors considered.

Economies of Scale — The Board reviewed information regarding potential economies of scale or other efficiencies that may result from increases in the Fund’s assets, noting that the issue of economies of scale had been focused on extensively by the 15(c) Committee during its meetings and addressed by management. The Board and the 15(c) Committee reviewed information provided by BFA regarding scale benefits shared with the iShares funds through relatively low fee rates established at inception, breakpoints, waivers, or other fee reductions, as well as through additional investment in the iShares business and the provision of improved or additional infrastructure and services to the iShares funds and their shareholders. The Board and the 15(c) Committee received information regarding BlackRock’s historical profitability, including BFA’s and its affiliates’ costs in providing services. The cost information distinguished, among other things, between fixed and variable costs, and explained how the level of fixed and variable costs, as well as the nature of such costs, may impact the existence or size of scale benefits. The Board noted that the Advisory Contract for the Fund did not provide for any breakpoints in the Fund’s investment advisory fee rate as the assets of the Fund increase. However, the Board noted that should material economies of scale exist in the future that are not otherwise shared, a breakpoint structure for the Fund may be appropriate, and that it would continue to monitor the sharing of economies of scale to determine the appropriateness of adding breakpoints in the future.

Fees and Services Provided for Other Comparable Funds/Accounts Managed by BFA and its Affiliates — The Board received and considered information regarding the investment advisory/management fee rates for other funds/accounts in the U.S. for which BFA (or its affiliates) provides investment advisory/management services, including open-end funds registered under the 1940 Act (including sub-advised funds), collective trust funds, and institutional separate accounts (together, the “Other Accounts”), and acknowledged BFA’s assertion that the iShares funds are fundamentally different investment vehicles from the Other Accounts. The Board noted that BFA and its affiliates do not manage Other Accounts with a similar investment strategy or investment mandate as the Fund. The Board further noted that BFA provided the Board with detailed information regarding how the Other Accounts (particularly institutional clients) generally differ from the Fund, including in terms of the different and generally more extensive services provided to the Fund, as well as other significant differences. In that regard, the Board considered that the pricing of services to institutional clients is typically based on a number of factors beyond the nature and extent of the specific services to be provided and often depends on the overall relationship between the client and its affiliates and the adviser and its affiliates. In addition, the Board considered the relative complexity and inherent risks and challenges of managing and providing other services to the Fund, as a publicly traded exchange traded fund, as compared to the Other Accounts that are institutional clients in light of differing regulatory requirements and client-imposed mandates. The Board also considered the “all-inclusive” nature of the Fund’s advisory fee structure, and the Fund expenses borne by BFA under this arrangement. The Board noted that the investment advisory fee rate under the Advisory Contract for the Fund was generally higher than the investment advisory/management fee rates for certain of the Other Accounts (particularly institutional clients) and concluded that the differences appeared to be consistent with the factors discussed.


BOARD REVIEWAND APPROVALON INVESTMENT ADVISORY CONTRACT			57

Board Review and Approval on Investment Advisory

Contract (Continued)

iSHARES^® U.S. ETF TRUST

to BFA’s profitability methodology), and payment of advisory fees and/or administration fees to BFA and BTC (or their affiliates) in connection with any investments by the Fund in other funds for which BFA (or its affiliates) provides investment advisory services and/or administration services. The Board noted that BFA generally does not use soft dollars or consider the value of research or other services that may be provided to BFA (including its affiliates) in selecting brokers for portfolio transactions for the Fund. The Board further noted that any portfolio transactions on behalf of the Fund placed through a BFA affiliate or purchased from an underwriting syndicate in which a BFA affiliate participates, are reported to the Board pursuant to Rule 17e-1 or Rule 10f-3, as applicable, under the 1940 Act. The Board concluded that any such ancillary benefits would not be disadvantageous to the Fund’s shareholders and thus would not alter the Board’s conclusion with respect to the appropriateness of approving the continuance of the Advisory Contract for the coming year.

Based on the considerations described above, the Board determined that the Fund’s investment advisory fee rate under the Advisory Contract does not constitute a fee that is so disproportionately large as to bear no reasonable relationship to the services rendered and that could not have been the product of arm’s-length bargaining, and concluded that it is in the best interest of the Fund and its shareholders to approve the continuance of the Advisory Contract for the coming year.

At the June 21-23, 2016 meeting, BFA sought approval from the Board to close and liquidate the Fund in the third quarter of 2016. BFA noted to the Board, among other things, that the Fund had generated limited interest since its launch and did not have favorable prospects to achieve scale, and the Board unanimously voted to close and liquidate the Fund.


58		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Supplemental Information (Unaudited)

iSHARES^® U.S. ETF TRUST

Section 19(a) Notices

The amounts and sources of distributions reported are estimates and are provided pursuant to regulatory requirements and are not being provided for tax reporting purposes. The actual amounts and sources for tax reporting purposes will depend upon each Fund’s investment experience during the year and may be subject to changes based on the tax regulations. Shareholders will receive a Form 1099-DIV each calendar year that will inform them how to report these distributions for federal income tax purposes.


	Total Cumulative Distributions for the Fiscal Year								% Breakdown of the Total Cumulative Distributions for the Fiscal Year
iShares ETF	Net Investment Income		Net Realized Capital Gains		Return of Capital		Total Per Share		Net Investment Income			Net Realized Capital Gains			Return of Capital			Total Per Share
Enhanced International Large-Cap	$	0.649687	$	—	$	—	$	0.649687		100	%		—	%		—	%		100	%
Enhanced International Small-Cap		0.429902		—		—		0.429902		100			—			—			100
Enhanced U.S. Large-Cap		0.613487		—		—		0.613487		100			—			—			100
Enhanced U.S. Small-Cap		0.476040		—		0.009458		0.485498		98			—			2			100

Premium/Discount Information

The Premium/Discount Information section is intended to present information about the differences between the daily market price on secondary markets for shares of a fund and that fund’s NAV. NAV is the price at which a fund issues and redeems shares. It is calculated in accordance with the standard formula for valuing mutual fund shares. The “Market Price” of a fund generally is determined using the midpoint between the highest bid and the lowest offer on the primary stock exchange on which the shares of such fund are listed for trading, as of the time that the fund’s NAV is calculated. A fund’s Market Price may be at, above or below its NAV. The NAV of a fund will fluctuate with changes in the fair value of its portfolio holdings. The Market Price of a fund will fluctuate in accordance with changes in its NAV, as well as market supply and demand.

Premiums or discounts are the differences (expressed as a percentage) between the NAV and Market Price of a fund on a given day, generally at the time the NAV is calculated. A premium is the amount that a fund is trading above the reported NAV, expressed as a percentage of the NAV. A discount is the amount that a fund is trading below the reported NAV, expressed as a percentage of the NAV.

The following information shows the frequency of distributions of premiums and discounts for each of the Funds. The information shown for each Fund is for five calendar years (or from the inception date of such Fund if less than five years) through the date of the most recent calendar quarter-end. The specific periods covered for each Fund are disclosed in the table for such Fund.


SUPPLEMENTAL INFORMATION			59

Supplemental Information (Unaudited) (Continued)

iSHARES^® U.S. ETF TRUST

Each line in the table shows the number of trading days in which the Fund traded within the premium/discount range indicated. The number of trading days in each premium/discount range is also shown as a percentage of the total number of trading days in the period covered by each table. All data presented here represents past performance, which cannot be used to predict future results.

iShares Enhanced International Large-Cap ETF

Period Covered: February 25, 2014 through June 30, 2016


Premium/Discount Range	Number of Days		Percentage of Total Days
Greater than 1.5% and Less than 2.0%		10		1.69	%
Greater than 1.0% and Less than 1.5%		24		4.05
Greater than 0.5% and Less than 1.0%		153		25.80
Between 0.5% and –0.5%		373		62.90
Less than –0.5% and Greater than –1.0%		26		4.38
Less than –1.0% and Greater than –1.5%		7		1.18

		593		100.00	%

iShares Enhanced International Small-Cap ETF

Period Covered: February 25, 2014 through June 30, 2016


Premium/Discount Range	Number of Days		Percentage of Total Days
Greater than 2.5% and Less than 3.0%		1		0.17	%
Greater than 2.0% and Less than 2.5%		2		0.34
Greater than 1.5% and Less than 2.0%		19		3.20
Greater than 1.0% and Less than 1.5%		77		12.98
Greater than 0.5% and Less than 1.0%		246		41.49
Between 0.5% and –0.5%		231		38.95
Less than –0.5% and Greater than –1.0%		16		2.70
Less than –1.0% and Greater than –1.5%		1		0.17

		593		100.00	%

iShares Enhanced U.S. Large-Cap ETF

Period Covered: April 16, 2013 through June 30, 2016


Premium/Discount Range	Number of Days		Percentage of Total Days
Between 0.5% and –0.5%		810		100.00	%


60		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Supplemental Information (Unaudited) (Continued)

iSHARES^® U.S. ETF TRUST

iShares Enhanced U.S. Small-Cap ETF

Period Covered: April 16, 2013 through June 30, 2016


Premium/Discount Range	Number of Days		Percentage of Total Days
Between 0.5% and –0.5%		810		100.00	%


SUPPLEMENTAL INFORMATION			61

Trustee and Officer Information

iSHARES^® U.S. ETF TRUST

The Board of Trustees has responsibility for the overall management and operations of the Funds, including general supervision of the duties performed by BFA and other service providers. Each Trustee serves until he or she resigns, is removed, dies, retires or becomes incapacitated. The President, Chief Compliance Officer, Treasurer and Secretary shall each hold office until their successors are chosen and qualify, and all other officers shall hold office until he or she resigns or is removed. Trustees who are not “interested persons” (as defined in the 1940 Act) of the Trust are referred to as independent trustees (“Independent Trustees”).

The registered investment companies advised by BFA or its affiliates (the “BlackRock-advised Funds”) are organized into one complex of closed-end funds, two complexes of open-end funds and one complex of exchange-traded funds (“Exchange-Traded Fund Complex”) (each, a “BlackRock Fund Complex”). Each Fund is included in the BlackRock Fund Complex referred to as the Exchange-Traded Fund Complex. Each Trustee also serves as a Director of iShares, Inc. and a Trustee of iShares Trust and, as a result, oversees a total of 342 funds (as of July 31, 2016) within the Exchange-Traded Fund Complex. With the exception of Robert S. Kapito, Mark Wiedman, and Benjamin Archibald the address of each Trustee and Officer is c/o BlackRock, Inc., 400 Howard Street, San Francisco, CA 94105. The address of Mr. Kapito, Mr. Wiedman, and Mr. Archibald is c/o BlackRock, Inc., Park Avenue Plaza, 55 East 52^nd Street, New York, NY 10055. The Board has designated Cecilia H. Herbert as its Independent Board Chair. Additional information about the Funds’ Trustees and officers may be found in the Funds’ combined Statement of Additional Information, which is available without charge, upon request, by calling toll-free 1-800-iShares (1-800-474-2737).

Interested Trustees

^a	Robert S. Kapito is deemed to be an “interested person” (as defined in the 1940 Act) of the Trust due to his affiliations with BlackRock, Inc.

^b	Mark Wiedman is deemed to be an “interested person” (as defined in the 1940 Act) of the Trust due to his affiliations with BlackRock, Inc. and its affiliates.


62		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Trustee and Officer Information (Continued)

iSHARES^® U.S. ETF TRUST

Independent Trustees^c



Name (Age)	Position(s)	Principal Occupation(s) During the Past 5 Years	Other Directorships Held by Trustee During the Past 5 Years
Cecilia H. Herbert (67)	Trustee (since 2011); Independent Board Chair (since 2016); Nominating and Governance Committee Chair (since 2016).	Director (1998-2013) and President (2007-2011) of the Board of Directors, Catholic Charities CYO; Trustee (2002-2011) and Chair of the Finance and Investment Committee (2006-2010) of the Thacher School; Member (since 1992) and Chair (1994-2005) of the Investment Committee, Archdiocese of San Francisco; Trustee and Member of the Investment Committee, WNET, the New York public media company (since 2011).	Director of iShares, Inc. (since 2005); Trustee of iShares Trust (since 2005); Independent Board Chair of iShares Inc. and iShares Trust (Since 2016); Director of Forward Funds (23 portfolios) (since 2009); Director of Salient MF Trust (4 Portfolios) (since 2015).
Jane D. Carlin (60)	Trustee (since 2015); Risk Committee Chair (since 2016).	Managing Director and Global Head of Financial Holding Company Governance & Assurance and the Global Head of Operational Risk Management of Morgan Stanley (2006-2012).	Director of iShares, Inc. (since 2015); Trustee of iShares Trust (since 2015); Director of PHH Corporation (mortgage solutions) (since 2012).
Charles A. Hurty (72)	Trustee (since 2011); Audit Committee Chair (since 2011).	Retired; Partner, KPMG LLP (1968-2001).	Trustee of iShares Trust (since 2005); Director of iShares, Inc. (since 2005); Director of GMAM Absolute Return Strategy Fund (1 portfolio) (since 2002); Director of SkyBridge Alternative Investments Multi-Adviser Hedge Fund Portfolios LLC (2 Portfolios) (since 2002).
John E. Kerrigan (61)	Trustee (since 2011); Securities Lending Committee Chair (since 2016).	Chief Investment Officer, Santa Clara University (since 2002).	Director of iShares, Inc. (since 2005); Trustee of iShares Trust (since 2005).

John E. Martinez (55)	Trustee (since 2011); Fixed Income Plus Committee Chair (since 2016).	Director of FirstREX Agreement Corp. (formerly EquityRock, Inc.) (since 2005).	Director of iShares, Inc. (since 2003); Trustee of iShares Trust (since 2003);


TRUSTEEAND OFFICER INFORMATION			63

Trustee and Officer Information (Continued)

iSHARES^® U.S. ETF TRUST

Independent Trustees^c (Continued)

^c	Robert H. Silver served as an Independent Trustee until March 31, 2016.


64		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

Trustee and Officer Information (Continued)

iSHARES^® U.S. ETF TRUST

Officers



Name (Age)	Position(s)	Principal Occupation(s) During the Past 5 Years
Manish Mehta (45)	President (since 2013).	Managing Director, BlackRock, Inc. (since 2009); Chief Operating Officer for iShares (since 2009); Head of Strategy and Corporate Development, BGI (2005-2009); Chief of Staff to the CEO, BGI (2005-2009).

Jack Gee (56)	Treasurer and Chief Financial Officer (since 2011).	Managing Director, BlackRock, Inc. (since 2009); Senior Director of Fund Administration of Intermediary Investor Business, BGI (2009); Director of Fund Administration of Intermediary Investor Business, BGI (2004-2009).

Benjamin Archibald (41)	Secretary (since 2015).	Managing Director, BlackRock, Inc. (since 2014); Director, BlackRock, Inc. (2010-2013); Secretary of the BlackRock-advised Mutual Funds (since 2012).

Charles Park (48)	Chief Compliance Officer (since 2011).	Chief Compliance Officer of BlackRock Advisors, LLC and the BlackRock-advised Funds in the Equity-Bond Complex, the Equity-Liquidity Complex and the Closed-End Complex (since 2014); Chief Compliance Officer, BFA (since 2006).

Scott Radell (47)	Executive Vice President (since 2012).	Managing Director, BlackRock, Inc. (since 2009); Head of Portfolio Solutions, BlackRock, Inc. (since 2009); Head of Portfolio Solutions, BGI (2007-2009); Credit Portfolio Manager, BGI (2005-2007); Credit Research Analyst, BGI (2003-2005).

Amy Schioldager (53)	Executive Vice President (since 2011).	Senior Managing Director, BlackRock, Inc. (since 2009); Global Head of Index Equity, BGI (2008-2009); Global Head of U.S. Indexing, BGI (2006-2008); Head of Domestic Equity Portfolio Management, BGI (2001-2006).


TRUSTEEAND OFFICER INFORMATION			65

Notes:


66		2016 iSHARES ANNUAL REPORTTO SHAREHOLDERS

For more information visit www.iShares.com or call 1-800-iShares (1-800-474-2737)

This report is intended for the Funds’ shareholders. It may not be distributed to prospective investors unless it is preceded or accompanied by the current prospectus.

Investing involves risk, including possible loss of principal.

The iShares Funds are distributed by BlackRock Investments, LLC (together with its affiliates, “BlackRock”).

A description of the policies that the Funds use to determine how to vote proxies relating to portfolio securities and information about how the Funds voted proxies relating to portfolio securities during the most recent twelve-month period ending June 30 is available without charge, upon request, by calling toll-free 1-800-474-2737; on the Funds’ website at www.iShares.com; and on the U.S. Securities and Exchange Commission (SEC) website at www.sec.gov.

The Funds file their complete schedules of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the SEC’s website or may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The Funds also disclose their complete schedules of portfolio holdings on a daily basis on the Funds’ website.

iS-AR-712-0716

Item 2.

Code of Ethics.

iShares U.S. ETF Trust (the “Registrant”) adopted a new code of ethics on July 1, 2016 that applies to persons appointed by the Registrant’s Board of Trustees as the President and/or Chief Financial Officer, and any persons performing similar functions. For the fiscal year ended July 31, 2016, there were no amendments to any provision of the former and new codes of ethics, nor were there any waivers granted from any provision of the former and new codes of ethics. A copy of the new code of ethics is filed with this Form N-CSR under Item 12(a)(1).

Item 3.

Audit Committee Financial Expert.

The Registrant’s Board of Trustees has determined that the Registrant has more than one audit committee financial expert, as that term is defined under Item 3(b) and 3(c), serving on its audit committee. The audit committee financial experts serving on the Registrant’s audit committee are Charles A. Hurty, John E. Kerrigan and Madhav V. Rajan, all of whom are independent, as that term is defined under Item 3(a)(2). Robert H. Silver resigned from the Board of Trustees effective March 31, 2016.

Item 4.

Principal Accountant Fees and Services.

The principal accountant fees disclosed in items 4(a), 4(b), 4(c), 4(d) and 4(g) are for the four series of the Registrant for which the fiscal year-end is July 31, 2016 (the “Funds”), and whose annual financial statements are reported in Item 1.

(a)

Audit Fees – The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of the Funds’ annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years were $56,200 for the fiscal year ended July 31, 2015 and $57,000 for the fiscal year ended July 31, 2016.

(b)

Audit-Related Fees – There were no fees billed for the fiscal years ended July 31, 2015 and July 31, 2016 for assurance and related services by the principal accountant that were reasonably related to the performance of the audit of the Fund’s financial statements and are not reported under (a) of this Item.

(c)

Tax Fees – The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for the review of the Funds’ tax returns and excise tax calculations, were $14,928 for the fiscal year ended July 31, 2015 and $15,124 for the fiscal year ended July 31, 2016.

(d)

All Other Fees – There were no other fees billed for the fiscal years ended July 31, 2015 and July 31, 2016 for products and services provided by the principal accountant, other than the services reported in (a) through (c) of this Item.

(e)

(1) The Registrant’s audit committee charter, as amended, provides that the audit committee is responsible for the approval, prior to appointment, of the engagement of the principal accountant to annually audit and provide their opinion on the Registrant’s financial statements. The audit committee must also approve, prior to appointment, the engagement of the principal accountant to provide non-audit services to the Registrant or to any entity controlling, controlled by or under common control with the Registrant’s investment adviser (“Adviser Affiliate”) that provides ongoing services to the Registrant, if the engagement relates directly to the operations and financial reporting of the Registrant.

(2) There were no services described in (b) through (d) above (including services required by the audit committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X) that were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f)

None of the hours expended on the principal accountant’s engagement to audit the Funds’ financial statements for the fiscal year ended July 31, 2016 were attributable to work performed by persons other than the principal accountant’s full-time, permanent employees.

(g)

The aggregate non-audit fees billed by the Registrant’s principal accountant for services rendered to the Funds, and rendered to the Registrant’s investment adviser, and any Adviser Affiliate that provides ongoing services to the Registrant for the last two fiscal years were $3,956,652 for the fiscal year ended July 31, 2015 and $4,572,444 for the fiscal year ended July 31, 2016.

(h)

The Registrant’s audit committee has considered whether the provision of non-audit services rendered to the Registrant’s investment adviser and any Adviser Affiliate that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, if any, are compatible with maintaining the principal accountant’s independence, and has determined that the provision of these services do not compromise the principal accountant’s independence.

Item 5.

Audit Committee of Listed Registrants.

The Registrant is a listed issuer as defined in Rule 10A-3 under the Exchange Act and has a separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act. The Registrant’s audit committee members are Charles A. Hurty, John E. Kerrigan and Madhav V. Rajan. Robert H. Silver resigned from the Board of Trustees effective March 31, 2016.

Item 6.

Investments.

(a)

Schedules of investments are included as part of the reports to shareholders filed under Item 1 of this Form.

(b)

Not applicable.

Item 7.

Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable to the Registrant.

Item 8.

Portfolio Managers of Closed-End Management Investment Companies.

Not applicable to the Registrant.

Item 9.

Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable to the Registrant.

Item 10.

Submission of Matters to a Vote of Security Holders.

There were no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees.

Item 11.

Controls and Procedures.

(a) The President (the Registrant’s Principal Executive Officer) and Chief Financial Officer (the Registrant’s Principal Financial Officer) have concluded that, based on their evaluation as of a date within 90 days of the filing date of this report, the disclosure controls and procedures of the Registrant (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) are reasonably designed to achieve the purposes described in Section 4(a) of the attached certification.

(b) There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

Item 12.

Exhibits.

(a) (1) Code of Ethics for Senior Officers that is the subject of Item 2 is attached.

(a) (2) Section 302 Certifications are attached.

(a) (3) Not applicable to the Registrant.

(b) Section 906 Certifications are attached.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

iShares U.S. ETF Trust

By: /s/ Manish Mehta

Manish Mehta, President (Principal Executive Officer)

Date: September 29, 2016

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

By: /s/ Manish Mehta

Manish Mehta, President (Principal Executive Officer)

Date: September 29, 2016

By: /s/ Jack Gee

Jack Gee, Treasurer and Chief Financial Officer (Principal Financial Officer)

Date: September 29, 2016

Name (Age)

Position(s)

Principal Occupation(s)
During the Past 5 Years

Other Directorships Held by Trustee
During the Past 5 Years

Robert S. Kapito^a (59)

Trustee
(since 2011).

President and Director, BlackRock, Inc. (since 2006); Vice Chairman of BlackRock, Inc. and Head of BlackRock, Inc.’s Portfolio Management Group (since its formation in 1998) and BlackRock, Inc.’s predecessor entities (since 1988); Trustee, University of Pennsylvania (since 2009); President of Board of Directors, Hope & Heroes Children’s Cancer Fund (since 2002); President of the Board of Directors, Periwinkle Theatre for Youth (since 1983).

Director of iShares, Inc. (since 2009);
Trustee of iShares Trust (since 2009).

Mark Wiedman^b (45)

Trustee
(since 2013)

Managing Director, BlackRock, Inc. (since 2007); Global Head of iShares (since 2011); Head of Corporate Strategy, BlackRock, Inc. (2009-2011).

Director of iShares, Inc. (since 2013); Trustee of iShares Trust (since 2013); Director of PennyMac Financial Services, Inc. (since 2008).