UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

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

FOR THE QUARTERLY PERIOD ENDED ~~September 30, 2017~~MARCH 31, 2020

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

Commission file number 1-7933

Aon plc

(Exact Name of Registrant as Specified in Its Charter)



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

Metropolitan Building, James Joyce Street, Dublin 1, IrelandD01 K0Y8



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

+~~44 20 7623 5500~~353 1266 6000

(Registrant’s Telephone Number,

Including Area Code)

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

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). ~~YES~~ ý NO oYes☒ No ☐

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



Large accelerated filerx	☒	Accelerated filero	☐
Non-accelerated filero	☐	Smaller reporting companyo	☐
~~(Do not check if a smaller reporting company)~~		Emerging growth companyo	☐

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ~~YES~~ o NO ýYes ☐ No ☒

Number of Class A Ordinary Shares of Aon plc, $0.01 nominal value, outstanding as of ~~October 26, 2017: 249,897,712~~April 30, 2020: 231,084,584

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Ordinary Shares $0.01 nominal value	AON	New York Stock Exchange
Guarantees of Aon plc’s 2.800% Senior Notes due 2021	AON21	New York Stock Exchange
Guarantees of Aon plc’s 4.000% Senior Notes due 2023	AON23	New York Stock Exchange
Guarantees of Aon plc’s 3.500% Senior Notes due 2024	AON24	New York Stock Exchange
Guarantees of Aon plc’s 3.875% Senior Notes due 2025	AON25	New York Stock Exchange
Guarantees of Aon plc’s 2.875% Senior Notes due 2026	AON26	New York Stock Exchange
Guarantees of Aon plc’s 4.250% Senior Notes due 2042	AON24	New York Stock Exchange
Guarantees of Aon plc’s 4.450% Senior Notes due 2043	AON43	New York Stock Exchange
Guarantees of Aon plc’s 4.600% Senior Notes due 2044	AON44	New York Stock Exchange
Guarantees of Aon plc’s 4.750% Senior Notes due 2045	AON45	New York Stock Exchange

Table of Contents



PART I

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

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

PART II

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

Part I Financial Information

Item 1. Financial Statements

Aon plc

Condensed Consolidated Statements of Income

(Unaudited)


	Three Months Ended						Nine Months Ended						Three Months Ended March 31,
(millions, except per share data)	September 30, 2017			September 30, 2016			September 30, 2017			September 30, 2016			2020			2019
Revenue
Total revenue	$	2,340		$	2,201		$	7,089		$	6,759		$	3,219		$	3,143
Expenses
Compensation and benefits	1,419			1,300			4,337			4,041			1,522			1,584
Information technology	109			99			295			281			111			117
Premises	89			86			259			257			73			87
Depreciation of fixed assets	40			39			148			118			41			40
Amortization and impairment of intangible assets	101			42			604			117
Other general expenses	317			267			956			770
Amortization of intangible assets													97			97
Other general expense													342			346
Total operating expenses	2,075			1,833			6,599			5,584			2,186			2,271
Operating income	265			368			490			1,175			1,033			872
Interest income	10			1			20			6			2			2
Interest expense	(70		)	(70		)	(211		)	(212		)	(83		)	(72		)
Other income (expense)	(5		)	10			(20		)	27			29			—
Income from continuing operations before income taxes	200			309			279			996			981			802
Income tax expense (benefit)	4			25			(139		)	127
Income tax expense													189			126
Net income from continuing operations	196			284			418			869			792			676
Income (loss) from discontinued operations, net of tax	(4		)	42			857			102
Net income (loss) from discontinued operations													(1		)	—
Net income	192			326			1,275			971			791			676
Less: Net income attributable to noncontrolling interests	7			7			30			27			19			17
Net income attributable to Aon shareholders	$	185		$	319		$	1,245		$	944		$	772		$	659

Basic net income (loss) per share attributable to Aon shareholders
Basic net income per share attributable to Aon shareholders
Continuing operations	$	0.74		$	1.03		$	1.49		$	3.13		$	3.31		$	2.72
Discontinued operations	(0.02		)	0.16			3.28			0.38			—			—
Net income	$	0.72		$	1.19		$	4.77		$	3.51		$	3.31		$	2.72
Diluted net income (loss) per share attributable to Aon shareholders
Diluted net income per share attributable to Aon shareholders
Continuing operations	$	0.73		$	1.03		$	1.48		$	3.11		$	3.29		$	2.70
Discontinued operations	(0.01		)	0.15			3.26			0.37			—			—
Net income	$	0.72		$	1.18		$	4.74		$	3.48		$	3.29		$	2.70
Cash dividends per share paid on ordinary shares	$	0.36		$	0.33		$	1.05		$	0.96
Weighted average ordinary shares outstanding - basic	255.6			267.5			260.9			269.1			233.2			242.2
Weighted average ordinary shares outstanding - diluted	257.3			269.6			262.9			271.0			234.5			243.7

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

Aon plc

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)



	Three Months Ended March 31,
(millions)	2020			2019
Net income	$	791		$	676
Less: Net income attributable to noncontrolling interests	19			17
Net income attributable to Aon shareholders	772			659
Other comprehensive income (loss), net of tax:
Change in fair value of financial instruments	(5		)	7
Foreign currency translation adjustments	(397		)	133
Postretirement benefit obligation	24			31
Total other comprehensive income (loss)	(378		)	171
Less: Other comprehensive income attributable to noncontrolling interests	(2		)	2
Total other comprehensive income (loss) attributable to Aon shareholders	(376		)	169
Comprehensive income attributable to Aon shareholders	$	396		$	828

Three Months Ended Nine Months Ended
(millions) September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016
Net income $ 192
$ 326
$ 1,275
$ 971
Less: Net income attributable to noncontrolling interests 7
7
30
27
Net income attributable to Aon shareholders $ 185
$ 319
$ 1,245
$ 944
Other comprehensive income (loss), net of tax:

Change in fair value of financial instruments 11
—
13
(11 )
Foreign currency translation adjustments 243
(89 ) 434
(227 )
Postretirement benefit obligation 18
18
56
(132 )
Total other comprehensive income (loss) 272
(71 ) 503
(370 )
Less: Other comprehensive income attributable to noncontrolling interests 7
—
3
—
Total other comprehensive income (loss) attributable to Aon shareholders 265
(71 ) 500
(370 )
Comprehensive income attributable to Aon shareholders $ 450
$ 248
$ 1,745
$ 574

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

Aon plc

Condensed Consolidated Statements of Financial Position

~~(Unaudited)~~


							(Unaudited)
(millions, except nominal value)	September 30, 2017			December 31, 2016			March 31, 2020			December 31, 2019
ASSETS
CURRENT ASSETS
Assets
Current assets
Cash and cash equivalents	$	749		$	426		$	690		$	790
Short-term investments	1,640			290			170			138
Receivables, net	2,068			2,106			3,554			3,112
Fiduciary assets	9,292			8,959			12,401			11,834
Other current assets	518			247			530			602
Current assets of discontinued operations	—			1,118
Total Current Assets	14,267			13,146
Total current assets							17,345			16,476
Goodwill	7,888			7,410			8,293			8,165
Intangible assets, net	1,341			1,890			746			783
Fixed assets, net	545			550			666			621
Operating lease right-of-use assets							897			929
Deferred tax assets	565			325			638			645
Prepaid pension	1,020			858			1,164			1,216
Other non-current assets	298			360			533			570
Non-current assets of discontinued operations	—			2,076
TOTAL ASSETS	$	25,924		$	26,615
Total assets							$	30,282		$	29,405

LIABILITIES AND EQUITY
LIABILITIES
CURRENT LIABILITIES
Liabilities and equity
Liabilities
Current liabilities
Accounts payable and accrued liabilities	$	1,588		$	1,604		$	1,549		$	1,939
Short-term debt and current portion of long-term debt	305			336			1,884			712
Fiduciary liabilities	9,292			8,959			12,401			11,834
Other current liabilities	1,289			656			1,277			1,086
Current liabilities of discontinued operations	—			940
Total Current Liabilities	12,474			12,495
Total current liabilities							17,111			15,571
Long-term debt	5,662			5,869			6,227			6,627
Non-current operating lease liabilities							910			944
Deferred tax liabilities	83			101			189			199
Pension, other postretirement and postemployment liabilities	1,612			1,760
Pension, other postretirement, and postemployment liabilities							1,655			1,738
Other non-current liabilities	846			719			930			877
Non-current liabilities of discontinued operations	—			139
TOTAL LIABILITIES	20,677			21,083
Total liabilities							27,022			25,956

EQUITY
Ordinary shares - $0.01 nominal value Authorized: 750 shares (issued: 2017 - 250.8; 2016 - 262.0)	3			3
Equity
Ordinary shares - $0.01 nominal value Authorized: 750 shares (issued: 2020 - 231.1; 2019 - 232.1)							2			2
Additional paid-in capital	5,670			5,577			6,121			6,152
Retained earnings	2,914			3,807			1,455			1,254
Accumulated other comprehensive loss	(3,412		)	(3,912		)	(4,409		)	(4,033		)
TOTAL AON SHAREHOLDERS' EQUITY	5,175			5,475
Total Aon shareholders' equity							3,169			3,375
Noncontrolling interests	72			57			91			74
TOTAL EQUITY	5,247			5,532
TOTAL LIABILITIES AND EQUITY	$	25,924		$	26,615
Total equity							3,260			3,449
Total liabilities and equity							$	30,282		$	29,405

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

Aon plc

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

(Unaudited)


(millions)	Shares		Ordinary Shares and Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss, Net of Tax			Non- controlling Interests			Total			Shares		Ordinary Shares and Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss, Net of Tax			Non- controlling Interests			Total
Balance at December 31, 2016	262.0		$	5,580		$	3,807		$	(3,912	)	$	57		$	5,532
Balance at December 31, 2019																		232.1		$	6,154		$	1,254		$	(4,033	)	$	74		$	3,449
Adoption of new accounting guidance	—		—			49			—			—			49			—		—			(6		)	—			—			(6		)
Balance at January 1, 2017	262.0		5,580			3,856			(3,912		)	57			5,581
Balance at January 1, 2020																		232.1		$	6,154		$	1,248		$	(4,033	)	$	74		$	3,443
Net income	—		—			1,245			—			30			1,275			—		—			772			—			19			791
Shares issued - employee stock compensation plans	3.3		(117		)	—			—			—			(117		)	1.2		(112		)	—			—			—			(112		)
Shares purchased	(14.5	)	—			(1,913		)	—			—			(1,913		)	(2.2	)	—			(463		)	—			—			(463		)
Share-based compensation expense	—		214			—			—			—			214			—		81			—			—			—			81
Dividends to shareholders	—		—			(274		)	—			—			(274		)
Dividends to shareholders ($0.44 per share)																		—		—			(102		)	—			—			(102		)
Net change in fair value of financial instruments	—		—			—			13			—			13			—		—			—			(5		)	—			(5		)
Net foreign currency translation adjustments	—		—			—			431			3			434			—		—			—			(395		)	(2		)	(397		)
Net postretirement benefit obligation	—		—			—			56			—			56			—		—			—			24			—			24
Purchases of shares from noncontrolling interests	—		(4		)	—			—			(1		)	(5		)
Dividends paid to noncontrolling interests on subsidiary common stock	—		—			—			—			(17		)	(17		)
Balance at September 30, 2017	250.8		$	5,673		$	2,914		$	(3,412	)	$	72		$	5,247
Balance at March 31, 2020																		231.1		$	6,123		$	1,455		$	(4,409	)	$	91		$	3,260



(millions)	Shares		Ordinary Shares and Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss, Net of Tax			Non- controlling Interests		Total
Balance at January 1, 2019	240.1		$	5,967		$	2,093		$	(3,909	)	$	68	$	4,219
Net income	—		—			659			—			17		676
Shares issued - employee stock compensation plans	1.4		(96		)	—			—			—		(96		)
Shares purchased	(0.6	)	—			(101		)	—			—		(101		)
Share-based compensation expense	—		89			—			—			—		89
Dividends to shareholders ($0.40 per share)	—		—			(96		)	—			—		(96		)
Net change in fair value of financial instruments	—		—			—			7			—		7
Net foreign currency translation adjustments	—		—			—			131			2		133
Net postretirement benefit obligation	—		—			—			31			—		31
Balance at March 31, 2019	240.9		$	5,960		$	2,555		$	(3,740	)	$	87	$	4,862

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

Aon plc

Condensed Consolidated Statements of Cash Flows

(Unaudited)



	Three Months Ended March 31,
(millions)	2020			2019
Cash flows from operating activities
Net income	$	791		$	676
Less: Net income (loss) from discontinued operations	(1		)	—
Adjustments to reconcile net income to cash provided by operating activities:
(Gain) loss from sales of businesses, net	(25		)	(4		)
Depreciation of fixed assets	41			40
Amortization and impairment of intangible assets	97			97
Share-based compensation expense	76			89
Deferred income taxes	(6		)	(25		)
Change in assets and liabilities:
Fiduciary receivables	(808		)	(609		)
Short-term investments — funds held on behalf of clients	(237		)	(541		)
Fiduciary liabilities	1,045			1,150
Receivables, net	(543		)	(458		)
Accounts payable and accrued liabilities	(275		)	(454		)
Restructuring reserves	(60		)	(25		)
Current income taxes	141			118
Pension, other postretirement and postemployment liabilities	(41		)	(54		)
Other assets and liabilities	141			74
Cash provided by operating activities	338			74
Cash flows from investing activities
Proceeds from investments	6			12
Payments for investments	(43		)	(14		)
Net sales (purchases) of short-term investments — non-fiduciary	(38		)	41
Acquisition of businesses, net of cash acquired	(334		)	(15		)
Sale of businesses, net of cash sold	30			6
Capital expenditures	(59		)	(57		)
Cash used for investing activities	(438		)	(27		)
Cash flows from financing activities
Share repurchase	(463		)	(100		)
Issuance of shares for employee benefit plans	(112		)	(98		)
Issuance of debt	2,060			871
Repayment of debt	(1,341		)	(694		)
Cash dividends to shareholders	(102		)	(96		)
Noncontrolling interests and other financing activities	40			(23		)
Cash provided by (used for) financing activities	82			(140		)
Effect of exchange rates on cash and cash equivalents	(82		)	37
Net decrease in cash and cash equivalents	(100		)	(56		)
Cash and cash equivalents at beginning of period	790			656
Cash and cash equivalents at end of period	$	690		$	600
Supplemental disclosures:
Interest paid	$	51		$	27
Income taxes paid, net of refunds	$	53		$	33

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

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

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

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

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

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

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

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

Notes to Condensed Consolidated Financial Statements (Unaudited)

1.Basis of Presentation

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

Certain information and disclosures normally included in the ~~financial statements~~Financial Statements prepared in accordance with U.S. GAAP have been condensed or omitted. ~~These Condensed Consolidated~~The Financial Statements should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2019, including amendments and additions disclosed on Form 8-K issued April 1, 2020. The results for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2020 are not necessarily indicative of operating results that may be expected for the full year ending December 31, ~~2017.~~

~~Discontinued Operations~~2020, particularly in light of the continuing effect of the COVID-19 pandemic.

On ~~February 9, 2017,~~April 1, 2020, a scheme of arrangement under English law was completed pursuant to which the ~~Company entered into~~Class A ordinary shares of Aon plc, a ~~Purchase Agreement (the “Purchase Agreement”) with Tempo Acquisition, LLC (the “Buyer”), an entity formed~~public limited company incorporated under the laws of England and ~~controlled by affiliates of The Blackstone Group L.P. Pursuant to~~Wales and the Purchase Agreement, the Company sold its benefits administration and business process outsourcing business (the “Divested Business”) to the Buyer and certain designated purchasers that are direct or indirect subsidiariespublicly traded parent company of the ~~Buyer (the “Transaction”~~Aon group (“Aon UK”)~~. As~~, were cancelled and the holders thereof received, on a ~~result, the Divested Business’s financial results are reflected~~one-for-one basis, Class A ordinary shares of Aon plc, an Irish public limited company formerly known as Aon Limited (“Aon Ireland”), as described in the ~~Condensed Consolidated Statements~~proxy statement filed with the U.S. Securities and Exchange Commission (“SEC”) on December 20, 2019 (the “Ireland Reorganization”). Aon Ireland is a tax resident of ~~Income, Condensed Consolidated Statements of Financial Position, and Condensed Consolidated Statements of Cash Flows, retrospectively, as discontinued operations beginning~~Ireland. References in the ~~first quarter of 2017. Additionally, all of the Notes to Condensed Consolidated~~ Financial Statements ~~have been retrospectively restated~~ to ~~only include~~“Aon” or the ~~impacts of continuing operations, unless noted otherwise. The Transaction closed on May~~“Company” for time periods prior to April 1, ~~2017. Refer~~2020 refer to ~~Note 3 “Discontinued Operations” for additional information.~~

~~Reportable Segments~~

~~Beginning~~Aon UK. References in the ~~first quarter of 2017,~~Financial Statements to “Aon” or the ~~Company began operating as one segment that includes all of Aon’s continuing operations, which provides advice and solutions~~“Company” for time periods on or after April 1, 2020, refer to ~~clients focused on risk, retirement, and health through five revenue lines that make up our principal products and services. Refer to Note 17 “Segment Information” for additional information.~~

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

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

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

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

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

Use of Estimates

The preparation of the ~~accompanying Condensed Consolidated~~ Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the ~~financial statements,~~Financial Statements, and the reported amounts of reserves and expenses. These estimates and assumptions are based on management’s best estimates and judgments. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. Management believes its estimates to be reasonable given the current facts available. Aon adjusts such estimates and assumptions when facts and circumstances dictate. Illiquid credit markets, volatile equity markets, ~~and~~ foreign currency exchange rate movements, and, recently, impacts from the COVID-19 pandemic increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in estimates resulting from continuing changes in the economic environment would, if applicable, be reflected in the ~~financial statements~~Financial Statements in future periods.

2. Accounting Principles and Practices

Adoption of New Accounting Standards

~~Share-based Compensation~~Cloud Computing Arrangements

In ~~March 2016,~~August 2018, the Financial Accounting Standards Board (“FASB”) issued new accounting guidance on several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows.implementation costs incurred in a cloud computing arrangement that is a service contract. The new guidance ~~requires all excess tax benefits and tax deficiencies to~~aligns capitalization requirements for certain implementation costs incurred in cloud computing arrangements with existing requirements for capitalizing implementation costs for internal-use software. These costs will be ~~recognized as income tax expense or benefit in~~deferred over the income statement and treated as discrete items in the reporting period. Further, excess tax benefits are required to be classified along with other income tax cash flows as an operating activity. Amendments related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements, forfeitures, and intrinsic value should be applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity asterm of the ~~beginning of~~hosting arrangement, including any optional renewal periods the ~~period in which the guidance~~entity is ~~adopted. Amendments related~~reasonably certain to the presentation of employee taxes paid on the statement of cash flows when an employer withholds shares to meet the minimum statutory withholding requirement should be applied retrospectively. Amendments requiring recognition of excess tax benefits and tax deficiencies in the income statement and the practical expedient for estimating expected term should be applied prospectively.exercise. An entity may ~~elect to apply the amendments related to the presentation of excess tax benefits on the statement of cash flows using either a prospective transition method or a retrospective transition method.~~

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

An increase to Deferred tax assets on the Condensed Consolidated Statement of Financial Position of approximately $49 million through a cumulative-effect adjustment to Retained earnings for excess tax benefits not previously recognized, and

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

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

~~Accounting Standards Issued But Not Yet Adopted~~

~~Targeted Improvements to Accounting for Hedging Activities~~

In August 2017, the FASB issued new accounting guidance on targeted improvements to accounting for hedging activities. The new guidance amends its hedge accounting model to enable entities to better portray their risk management activities in the financial statements. The guidance eliminates the requirement to separately measure and report hedge ineffectiveness and requires the effect of a hedging instrument to be presented in the same income statement line as the hedged item. An entity will apply the new guidance on either a ~~modified~~prospective or retrospective basis with a cumulative effect adjustment to accumulated other comprehensive income with a corresponding adjustment to retained earnings as of the beginning of the period of adoption. Changes to income statement presentation and financial statement disclosures will be applied prospectively.basis. The new guidance iswas effective for Aon in the first quarter of ~~2019~~2020 and ~~early adoption is permitted. The Company is currently evaluating the impact that the standard will have~~was adopted on ~~the Condensed Consolidated Financial Statements and the period in which it plans to adopt.~~

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

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

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

Simplifying the Test for Goodwill Impairment

In January 2017, the FASB issued new accounting guidance on simplifying the test for goodwill impairment. Currently the standard requires an entity to perform a two-step test to determine the amount, if any, of goodwill impairment. In Step 1, an entity compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of the reporting unit exceeds its fair value, the entity performs Step 2 and compares the implied fair value of goodwill with the carrying amount of that goodwill for that reporting unit. An impairment charge equal to the amount by which the carrying amount of goodwill for the reporting unit

exceeds the implied fair value of that goodwill is recorded, limited to the amount of goodwill allocated to that reporting unit. The new guidance removes Step 2. An entity will apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not amend the optional qualitative assessment of goodwill impairment. ~~An entity will apply the new guidance on a prospective basis.~~ The new guidance iswas effective for Aon in the first quarter of 2020 and early adoption is permitted for annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the period of adoption and the impact that the standard will have on the Condensed Consolidated Financial Statements.

~~Income Tax Consequences of Intercompany Transactions~~

In October 2016, the FASB issued new accounting guidance on the income tax consequences of intra-entity asset transfers other than inventory. The guidance will require that the seller and buyer recognize the consolidated current and deferred income tax consequences of a transaction in the period the transaction occurs rather than deferring to a future period and recognizing those consequences when the asset has been sold to an outside party or otherwise recovered through use (i.e., depreciated, amortized, or impaired). An entity will apply the new guidancewas adopted on a ~~modified retrospective basis with a cumulative effect adjustment to retained earnings as~~prospective basis. The adoption of ~~the beginning of the period of adoption. The new~~this guidance ~~is effective for Aon in the first quarter of 2018, and the Company is currently evaluating the impact that the standard will have on the Condensed Consolidated Financial Statements.~~

~~Statement of Cash Flows~~

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

Credit Losses

In June 2016, the FASB issued a new accounting ~~guidance~~standard on the measurement of credit losses on financial instruments. The new ~~guidance~~standard replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ~~An entity will apply~~The Company adopted the new ~~guidance through a cumulative-effect~~standard as of January 1, 2020 using the modified retrospective approach. Under this approach, prior periods were not restated. Rather, the cumulative effect of initially applying the new standard was recognized as an adjustment to retained ~~earnings as~~earnings. Upon the adoption of this guidance on January 1, 2020, the Company recognized a cumulative adjustment of $6 million to decrease retained earnings.

The Company’s estimate for allowance for credit losses with respect to receivables is based on a combination of factors, including evaluation of forward-looking information, historical write-offs, aging of balances, and other qualitative and quantitative analyses.

Accounting Standards Issued But Not Yet Adopted

Simplifying the Accounting for Income Taxes

In December 2019, the FASB issued new accounting guidance that simplifies the accounting for income taxes by eliminating some exceptions to the general approach in the existing guidance. It also clarifies certain aspects of the ~~beginning of the first reporting period in which the~~existing guidance ~~is effective.~~to promote more consistent application. The new guidance is effective for Aon in the first quarter of ~~2020 and~~2021, with early adoption ~~is permitted beginning in the first quarter of 2019. Aon~~permitted. The Company is currently evaluating the impact that the ~~standard~~guidance will have on the ~~Condensed Consolidated~~ Financial Statements ~~as well as~~and the ~~method of transition and~~ period of adoption.

~~Leases~~Changes to the Disclosure Requirements for Defined Benefit Plans

In ~~February 2016,~~August 2018, the FASB issued new accounting guidance ~~on leases, which~~related to the disclosure requirements for employers that sponsor defined benefit pension and other postretirement benefit plans. The guidance requires ~~lessees~~sponsors of these plans to ~~recognize assets and liabilities for most leases. Under the new guidance, a lessee should recognize~~provide additional disclosures, including weighted average interest rates used in the ~~Condensed Consolidated Statement of Financial Position a liability to make lease payments~~entity’s cash balance pension plans and a ~~right-of-use asset representing its right to use~~narrative description of reasons for any significant gains or losses impacting the ~~underlying asset~~benefit obligation for the ~~lease term. The recognition, measurement,~~period, and ~~presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from currently effective U.S. GAAP.~~eliminates certain previous disclosure requirements. The new standard will be effective for the Company in the first quarter of 2019, with early adoption permitted. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The modified retrospective approach includes a number of optional practical expedients that entities may elect to apply. These practical expedients relate to the identification and classification of leases that commenced before the effective date, initial direct costs for leases that commenced before the effective date, and

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

~~Financial Assets and Liabilities~~

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

~~Revenue Recognition~~

In May 2014, the FASB issued a new accounting standard on revenue from contracts with customers, which, when effective, will supersede nearly all existing revenue recognition guidance under U.S. GAAP. The core principal of the standard is that an entity should recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The standard is effective for Aon in the first quarter of ~~2018 and~~2021, with early adoption is permitted ~~beginning in the first quarter of 2017. Two methods of transition are permitted upon adoption: full retrospective~~ and ~~modified retrospective. Under the full retrospective method, prior periods would~~will be restated under the new revenue standard, providing a comparable view across all periods presented. Under the modified retrospective method, prior periods would not be restated. Rather, revenue and other disclosures for pre-2018 periods would be provided in the notes to the financial statements as previously reported under the current revenue standard. The Company will adopt this standard in the first quarter of 2018 using a modified retrospective adoption approach.

~~A preliminary assessment to determine the impacts of the new accounting standard has been performed.~~applied retrospectively. The Company is currently ~~implementing accounting and operational processes and controls to ensure compliance with the new standard, but is still~~ evaluating the ~~quantitative impacts~~impact that the ~~standard~~guidance will have on ~~its financial statements.~~the Financial Statements and the period of adoption.

~~However,~~Securities and Exchange Commission Final Rules

Financial Disclosures about Guarantors

In March 2020, the ~~more significant impacts of the new standard~~SEC passed changes to the ~~Company~~disclosure requirements in Rules 3-10 and 3-16 of Regulation S-X to better align those requirements with the needs of investors and to simplify and streamline the disclosure obligations of registrants. The amendments are ~~anticipated to be as follows:~~

The Company currently recognizes revenue either at a point in time or over a period of time based on the transfer of value to customers or as the remuneration becomes determinable. Under the new standard, the revenue related to certain brokerage activities recognized over a period of time will be recognized on the effective date of the associated policies when control of the policy transfers to the customer. As a result, revenue from these arrangements will be recognized in earlier periods under the new standard in comparison to the current guidance and will change the timing and amount of revenue recognized for annual and interim periods. This change is anticipated to result in a significant shift in interim revenue for Reinsurance Solutions and certain other brokerage services.January 4, 2021, with early adoption permitted. The Company is currently ~~assessing~~evaluating the ~~timing~~impact that the guidance will have on the Financial Statements and ~~measurement~~the period of adoption.

3. Revenue from Contracts with Customers

Disaggregation of Revenue

The following table summarizes revenue ~~recognition under~~from contracts with customers by principal service line (in millions):



	Three Months Ended March 31,
	2020			2019
Commercial Risk Solutions	$	1,146		$	1,118
Reinsurance Solutions	848			788
Retirement Solutions	397			420
Health Solutions	502			486
Data & Analytic Services	331			336
Elimination	(5		)	(5		)
Total revenue	$	3,219		$	3,143

Consolidated revenue from contracts with customers by geographic area, which is attributed on the ~~new standard for certain other~~basis of where the services ~~including advisory, where limited impacts~~ are ~~anticipated.~~performed, is as follows (in millions):

~~Additionally,~~



	Three Months Ended March 31,
	2020		2019
United States	$	1,227	$	1,161
Americas other than United States	228		226
United Kingdom	500		452
Europe, Middle East, & Africa other than United Kingdom	978		1,009
Asia Pacific	286		295
Total revenue	$	3,219	$	3,143

Contract Costs

An analysis of the ~~new standard provides guidance on accounting for certain revenue-related~~changes in the net carrying amount of costs ~~including when~~ to ~~capitalize costs associated~~fulfill contracts with ~~obtaining and fulfilling a contract. The majority~~customers are as follows (in millions):



	Three Months Ended March 31,
	2020			2019
Balance at beginning of period	$	335		$	329
Additions	318			346
Amortization	(416		)	(439		)
Impairment	—			—
Foreign currency translation and other	(8		)	—
Balance at end of period	$	229		$	236

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

3.~~Discontinued Operations~~

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

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

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

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

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

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



	Three Months Ended March 31,
	2020			2019
Balance at beginning of period	$	171		$	156
Additions	12			9
Amortization	(12		)	(11		)
Impairment	—			—
Foreign currency translation and other	(4		)	1
Balance at end of period	$	167		$	155

Three months ended September 30 Nine months ended September 30

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

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

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

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

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

LIABILITIES

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


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

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

4. Cash and Cash Equivalents and Short-term Investments

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

At ~~September 30, 2017,~~March 31, 2020, Cash and cash equivalents and Short-term investments were ~~$2,389~~$860 million compared to ~~$716~~$928 million at December 31, ~~2016, an increase~~2019, a decrease of ~~$1,673 million that was primarily related to the receipt of proceeds from the sale of the Divested Business.~~$68 million. Of the total balances, ~~$98~~$95 million and ~~$82~~$110 million ~~was~~were restricted as to ~~its~~their use at ~~September 30, 2017~~March 31, 2020 and December 31, ~~2016,~~2019, respectively. Included within ~~the September 30, 2017~~Short-term investments as of March 31, 2020 and December 31, ~~2016 balances, respectively,~~2019 were £42.7 million ($~~57.5~~52.1 million at ~~September 30, 2017~~March 31, 2020 exchange ~~rates)~~rates and ~~£43.3 million ($53.2~~$55.5 million at December 31, ~~2016~~2019 exchange rates) of operating funds required to be held by the Company in the United Kingdom (the “U.K.”) by the Financial Conduct Authority (the “FCA”), a U.K.-based ~~regulator, which were included in Short-term investments.~~regulator.

5. Other Financial Data

Condensed Consolidated Statements of Income Information

Other Income (Expense)

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



	Three Months Ended March 31,
	2020			2019
Foreign currency remeasurement	$	42		$	(11	)
Disposal of businesses	25			5
Pension and other postretirement	4			4
Equity earnings	1			1
Financial instruments	(44		)	1
Other	1			—
Total	$	29		$	—

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

Condensed Consolidated Statements of Financial Position Information

Allowance for Doubtful Accounts

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



	Three Months Ended March 31,
	2020 ⁽¹⁾			2019
Balance at December 31	$	70		$	64
Adoption of new accounting guidance⁽²⁾	7			—
Balance at January 1	77			64
Provision	9			8
Accounts written off, net of recoveries	(8		)	(8		)
Foreign currency translation and other	3			—
Balance at end of period	$	81		$	64


(1)	The Company’s estimate for allowance for credit losses with respect to receivables is based on a combination of factors, including evaluation of forward-looking information, historical write-offs, aging of balances, and other qualitative and quantitative analyses. Refer to Note 2 “Accounting Principles and Practices” for further information.


(2)	The allowance for doubtful accounts resulted in a $7 million charge from the adoption of the new accounting standard on the measurement of credit losses. After tax impacts, this resulted in a $6 million decrease to Retained earnings. Refer to Note 2 “Accounting Principles and Practices” for further information.

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

Other Current Assets

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



As of	March 31, 2020		December 31, 2019
Costs to fulfill contracts with customers ⁽¹⁾	$	229	$	335
Prepaid expenses	156		97
Taxes receivable	79		88
Other ⁽²⁾	66		82
Total	$	530	$	602

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


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


(2)	December 31, 2019 includes $4 million previously classified as “Receivables from the Divested Business”.

Other Non-Current Assets

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



As of	March 31, 2020		December 31, 2019
Costs to obtain contracts with customers ⁽¹⁾	$	167	$	171
Taxes receivable	101		102
Leases	93		100
Investments	52		53
Other	120		144
Total	$	533	$	570

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


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

Other Current Liabilities

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



As of	March 31, 2020		December 31, 2019
Deferred revenue ⁽¹⁾	$	309	$	270
Leases	200		210
Taxes payable	196		93
Other	572		513
Total	$	1,277	$	1,086

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


(1)	~~Includes accrued taxes payable related to~~During the ~~gain on sale~~three months ended March 31, 2020, $117 million was recognized in the Condensed Consolidated Statement of Income. During the ~~Divested Business.~~12 months ended December 31, 2019, $532 million was recognized in the Consolidated Statement of Income.

Other Non-Current Liabilities

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



As of	March 31, 2020		December 31, 2019
Taxes payable ⁽¹⁾	$	544	$	525
Leases	74		76
Deferred revenue	72		62
Compensation and benefits	41		49
Other	199		165
Total	$	930	$	877


(1)	Includes $145 million for the non-current portion of the one-time mandatory transition tax on accumulated foreign earnings as of March 31, 2020 and December 31, 2019.

6. Restructuring

In 2017, Aon initiated a global restructuring plan (the “Restructuring Plan”) in connection with the sale of the benefits administration and business process outsourcing business (the “Divested Business”). The Restructuring Plan was intended to streamline operations across the organization and deliver greater efficiency, insight, and connectivity. The Company incurred all remaining costs for the Restructuring Plan, and the Restructuring Plan was closed in the fourth quarter of 2019. As such, for the three months ended March 31, 2020, 0 charges were taken under the Restructuring Plan. For the three months ended March 31, 2019, $91 million of restructuring expenses were charged under the Restructuring Plan.

As of December 31, 2019, the remaining liabilities for the Restructuring Plan were $204 million. During the three months ended March 31, 2020, the Company made cash payments of $60 million, and the effect of foreign currency translation and other non-cash activity was $17 million, resulting in restructuring liabilities of $127 million as of March 31, 2020.

As of September 30, 2017 December 31, 2016
Taxes payable $ 333
$ 288
Deferred revenue 45
49
Leases 145
136
Compensation and benefits 61
56
Other 262
190
Total $ 846
$ 719

6. 7. Acquisitions and Dispositions of Businesses

Completed Acquisitions

The Company completed ~~eight~~5 acquisitions during the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2020 and ~~eight acquisitions~~1 acquisition during the ~~twelve~~three months ended ~~December~~March 31, ~~2016.~~2019. The following table includes the preliminary fair values of consideration transferred, assets acquired, and liabilities assumed as a result of the Company’s acquisitions (in millions):



Consideration Transferred	Three Months Ended March 31, 2020
Cash	$	351
Deferred, contingent, and other consideration	35
Aggregate consideration transferred	$	386

Assets acquired
Cash and cash equivalents	$	17
Receivables	7
Goodwill	303
Intangible assets	74
Current assets	2
Non-current assets	5
Total assets acquired	408
Liabilities assumed
Current liabilities	11
Non-current liabilities	11
Total liabilities assumed	22
Net assets acquired	$	386

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

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

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

~~2017~~2020 Acquisitions

On ~~August 31, 2017,~~January 1, 2020, the Company completed the ~~transaction to acquire Mark Kelly Insurance and Financial Services PTY LTD, an Australia-based broker servicing the insurance needs~~acquisition of ~~commercial clients in and around the Townsville regional center.~~

~~On August 28, 2017, the Company completed the transaction to acquire a certain portfolio in the Charlotte office~~100% share capital of ~~The Hays Group, Inc. d/b/a Hays Companies.~~

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

On ~~July 3, 2017,~~January 1, 2020, the Company completed the ~~transaction to acquire PWZ AG,~~acquisition of 100% share capital of Assimedia SA, an ~~independent~~ insurance broker based in ~~Zurich,~~ Switzerland.

On ~~May 31, 2017,~~January 1, 2020, the Company completed the ~~transaction to acquire SchneiderGolling IFFOXX Assekuranzmakler AG and SchneiderGolling Industrie Assekuranzmaklergesellschaft mbH from SchneiderGolling Gruppe, a property and casualty~~acquisition of 100% share capital of TRIUM GmbH Insurance Broker, an insurance broker based in ~~Southern~~ Germany.

On ~~May 2, 2017,~~January 3, 2020, the Company completed the ~~transaction to acquire cut-e Assessment Global Holdings Limited,~~acquisition of 100% share capital of CoverWallet, Inc., a ~~high-volume online psychometric assessments provider based in Ireland.~~U.S.-based digital insurance platform for small- and medium-sized businesses.

On ~~March 3, 2017,~~January 31, 2020, the Company completed the ~~transaction~~acquisition of 100% share capital of Cytelligence Inc., a Canadian-based cyber security firm that provides incident response advisory, digital forensic expertise, security consulting services, and cyber security training for employees to ~~acquire Finaccord Limited, a market research, publishing~~help organizations respond to cyber security threats and ~~consulting company based in the United Kingdom.~~strengthen their security position.

2019 Acquisitions

On ~~January 19, 2017,~~July 31, 2019, the Company completed the ~~transaction to acquire VERO Management AG,~~acquisition of 100% share capital of Ovatio Courtage SAS, an insurance broker ~~and risk advisor~~ based in ~~Austria.~~

~~2016 Acquisitions~~France.

On ~~December 26, 2016,~~July 31, 2019, the Company completed the ~~transaction to acquire Admix,~~acquisition of 100% share capital of Zalba-Caldu Correduria de Seguros, S.A., a ~~leading health and benefits brokerage and solutions firm based in Brazil.~~Spanish insurance broker.

On ~~November 11, 2016~~January 1, 2019, the Company completed the ~~transaction to acquire CoCubes, a leading hiring assessment company~~acquisition of 100% share capital of Chapka Assurances SAS, based in ~~India.~~France.

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

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

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

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

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

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

Completed Dispositions

The Company completed ~~no dispositions~~1 disposition during the three months ended September 30, 2017 and four dispositions during the nine months ended September 30, 2017, excluding the sale of the Divested Business. Refer to Note 3 “Discontinued Operations” for further information.March 31, 2020. The Company completed ~~no dispositions~~1 disposition during the three months ended ~~September 30, 2016 and four dispositions during the nine months ended September 30, 2016.~~March 31, 2019.

~~There were no~~Total pretax gains recognized ~~on the disposition of businesses~~ for the three months ended ~~September 30, 2017 and 2016, excluding the sale of the Divested Business.~~March 31, 2020 were $25 million. Total ~~pretax losses recognized, net of gains, were $2 million for the nine months ended September 30, 2017, and total~~ pretax gains recognized ~~net of losses, were $41 million~~ for the ~~nine~~three months ended ~~September 30, 2016.~~March 31, 2019 were $5 million. Gains and losses recognized as a result of a disposition are included in Other income (expense) in the Condensed Consolidated Statements of Income.

Other Significant Activity

7. ~~Restructuring~~

~~In 2017,~~On March 9, 2020, Aon ~~initiated~~and Willis Towers Watson Public Limited Company, an Irish public limited company (“WTW”), entered into a ~~global restructuring plan~~business combination agreement (the ~~“Restructuring Plan”~~“Business Combination Agreement”) ~~in connection~~ with ~~the sale~~respect to a combination of the ~~Divested Business. The Restructuring Plan is intended~~parties (the “Combination”). Refer to ~~streamline operations across the organization~~“Business Combination Agreement” within Management’s Discussion and ~~deliver greater efficiency, insight,~~Analysis of Financial Condition and connectivity. The Company expects these restructuring activities and related expenses to affect continuing operations through 2019, including an estimated 2,400 to 2,850 role eliminations. The Restructuring Plan is expected to result in cumulative costsResults of approximately $750 million through the end of the plan, consisting of approximately $303 million in employee termination costs, $146 million in technology rationalization costs, $80 million in lease consolidation costs, $40 million in asset impairments, and $181 million in other costs, including certain separation costs associated with the sale of the Divested Business. Included in the estimated $750 million are $50 million of non-cash charges related to asset impairments and lease consolidations.

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

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

Three months ended September 30, 2017 Nine months ended September 30, 2017 Estimated Remaining Costs
Estimated Total Cost ⁽¹⁾
Workforce reduction $ 52
$ 257
$ 46
$ 303
Technology rationalization ⁽²⁾
12
22
124
146
Lease consolidation ⁽²⁾
4
8
72
80
Asset impairments 2
26
14
40
Other costs associated with restructuring and separation ^{(2) (3)}
32
88
93
181
Total restructuring and related expenses $ 102
$ 401
$ 349
$ 750

~~(1)~~

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

~~(2)~~

Contract termination costs included within Technology rationalization for the three and nine months ended September 30, 2017 were $1 million. Contract termination costs included within Lease consolidations for the three and nine months ended September 30, 2017 were $3 million and $8 million, respectively. Contract termination costs included within Other costs associated with restructuring and separation were $1 million for the three and nine months ended September 30, 2017. Total estimated contract termination costs to be incurred under the Restructuring Plan associated with Technology rationalizations, Lease consolidations, and Other costs associated with restructuring and separation, respectively, are $10 million, $80 million, and $10 million.


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

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

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

8. Goodwill and Other Intangible Assets

The changes in the net carrying amount of goodwill for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2020 are as follows (in millions):



Balance as of December 31, 2019	$	8,165
Goodwill related to current year acquisitions	303
Goodwill related to disposals	(3		)
Goodwill related to prior year acquisitions	—
Foreign currency translation	(172		)
Balance as of March 31, 2020	$	8,293

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

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



	March 31, 2020						December 31, 2019
	Gross Carrying Amount		Accumulated Amortization and Impairment		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization and Impairment		Net Carrying Amount
Customer-related and contract-based	$	2,227	$	1,590	$	637	$	2,264	$	1,600	$	664
Tradenames	1,026		1,005		21		1,029		956		73
Technology and other	408		320		88		380		334		46
Total	$	3,661	$	2,915	$	746	$	3,673	$	2,890	$	783

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


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

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

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

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

The estimated future amortization for ~~finite lived~~finite-lived intangible assets as of ~~September 30, 2017~~March 31, 2020 is as follows (in millions):



Remainder of 2020	$	139
2021	136
2022	96
2023	85
2024	69
2025	51
Thereafter	170
Total	$	746

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

9. Debt

Notes

~~During~~In March 2020, the ~~first quarter of 2017, the CAD 375~~Company’s $400 million ~~($304 million at September 30, 2017 exchange rates) 4.76%~~2.80% Senior Notes due March ~~2018~~2021 were classified as Short-term debt and current portion of long-term debt in the Condensed Consolidated Statements of Financial Position as the date of maturity is in less than one year.

On November 15, 2019, Aon Corporation, a Delaware corporation and a wholly owned subsidiary of the Company, issued $500 million 2.20% Senior Notes due November 2022. The Company used the net proceeds of the offering to pay down a portion of outstanding commercial paper and for general corporate purposes.

In September 2019, the Company’s $600 million 5.00% Senior Notes due September 2020 were classified as Short-term debt and current portion of long-term debt in the Condensed Consolidated Statements of Financial Position as the date of maturity is in less than one year.

On May 2, 2019, Aon Corporation issued $750 million 3.75% Senior Notes due May 2029. The Company used the net proceeds of the offering to pay down a portion of outstanding commercial paper and for general corporate purposes.

Revolving Credit Facilities

As of ~~September 30, 2017,~~March 31, 2020, Aon plc had ~~one~~2 primary committed credit ~~facility~~facilities outstanding: its $900 million multi-currency U.S. credit facility expiring in February ~~2021 (the “2021 Facility”). On October 19, 2017, Aon entered into a $400~~2022 and its $750 million multi-currency U.S. credit facility expiring in October ~~2022 (the “2022 Facility”). This facility replaced~~2023. Effective February 27, 2020, the ~~Company’s previous $400~~$750 million multi-currency U.S. credit facility ~~that expired~~was increased by $350 million from the original $400 million. In aggregate, these two facilities provide $1.65 billion in ~~March 2017.~~available credit.

~~The 2021 Facility~~Each of these primary committed credit facilities includes customary representations, warranties, and covenants, including financial covenants that require Aon to maintain specified ratios of adjusted consolidated earnings before interest, taxes, depreciation, and amortization (“EBITDA”) to consolidated interest expense and consolidated debt to adjusted consolidated EBITDA, in each case, tested quarterly. At ~~September 30, 2017,~~March 31, 2020, Aon did not have borrowings under ~~the 2021 Facility,~~either of these primary committed credit facilities, and was in compliance with the financial covenants and all other covenants contained therein during the ~~nine~~rolling 12 months ended ~~September 30, 2017.~~March 31, 2020.

Commercial Paper

Aon Corporation ~~a wholly-owned subsidiary of Aon plc,~~ has established a U.S. commercial paper program (the “U.S. Program”) and Aon UK has established a European multi-currency commercial paper program ~~(collectively~~(the “European Program” and, together with the ~~“CP~~U.S. Program, the “Commercial Paper Programs”). Commercial paper may be issued in an aggregate principal ~~amount~~amounts of up to ~~$1.3 billion~~$600 million under the ~~CP Programs, allocated between~~U.S. Program and €525 million under the ~~two programs as determined by management,~~European Program, not to exceed the amount of the Company’s committed credit, which was ~~$900 million~~$1.65 billion at ~~September 30, 2017. The~~March 31, 2020. As of March 31, 2020, the U.S. ~~commercial paper program is~~Program was fully and unconditionally guaranteed by Aon ~~plc~~UK and the European ~~commercial paper program is~~Program was fully and unconditionally guaranteed by Aon Corporation. In connection with the Ireland Reorganization, on April 1, 2020, a new guarantee structure for the Commercial Paper Programs was established. Refer to Note 18 “Guarantee of Registered Securities” for further information.

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



As of	March 31, 2020		December 31, 2019
Commercial paper outstanding	$	833	$	112

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

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



	Three Months Ended March 31,
	2020			2019
Weighted average commercial paper outstanding	$	456		$	323
Weighted average interest rate of commercial paper outstanding	0.96		%	0.49		%

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

10. Income Taxes

The effective tax rate on ~~net~~Net income from continuing operations was ~~2.0% and (49.8)%~~19.3% for the three ~~and nine~~ months ended ~~September 30, 2017, respectively.~~March 31, 2020. The effective tax rate on ~~net~~Net income from continuing operations was ~~8.1% and 12.8%~~15.7% for the three ~~and nine~~ months ended ~~September 30, 2016, respectively.~~ March 31, 2019.

For the three months ended ~~September 30, 2017,~~March 31, 2020, the ~~Company reported tax expense of $4 million on pretax income of $200 million, which resulted in an effective~~ tax rate ~~of 2.0%,~~was primarily driven by the ~~jurisdictional~~geographical distribution of income ~~including~~and certain discrete items, primarily the estimated impact of the Restructuring Program and the accelerated amortization of tradenames. For the nine months ended September 30, 2017, the Company reported a tax benefit of $139 million on pretax income of $279 million, which resulted in an effective tax rate of (49.8)%. The primary components of the year to date tax amounts were the non-cash tax benefit from the tradename impairment associated with the Divested Business and thefavorable impact of share-based ~~payments from adoption~~payments.

For the three months ended March 31, 2019, the tax rate was primarily driven by the geographical distribution of income and certain discrete items, primarily the ~~new share-based compensation guidance. Refer to Note 2 “Accounting Principles and Practices” for additional details.~~favorable impact of shared-based payments.

11. Shareholders’ Equity

Ordinary Shares

Aon has a share repurchase program authorized by the Company’s Board of Directors (the “Repurchase Program”). The Repurchase Program was established in April 2012 with ~~up to~~ $5.0 billion in authorized repurchases, and was increased by $5.0 billion in authorized repurchases in each of November 2014 and ~~February~~June 2017 for a total of $15.0 billion in repurchase authorizations. The Repurchase Program was adopted by Aon Ireland’s Board of Directors on April 1, 2020.

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

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



	Three Months Ended March 31,
	2020		2019
Shares repurchased	2.2		0.6
Average price per share	$	212.78	$	161.16
Costs recorded to retained earnings
Total repurchase cost	$	461	$	100
Additional associated costs	2		1
Total costs recorded to retained earnings	$	463	$	101

September 30, 2016, the Company repurchased 2.7 million shares at an average price per share of $110.26 for a total cost of approximately $301 million. During the nine months ended September 30, 2016, the Company repurchased 10.4 million shares at an average price per share of $101.16, for a total cost of approximately $1.1 billion. At ~~September 30, 2017,~~March 31, 2020, the remaining authorized amount for share ~~repurchase~~repurchases under the Repurchase Program was ~~$5.9~~$1.6 billion. Under the Repurchase Program, the Company has repurchased a total of ~~104.7~~130.9 million shares for an aggregate cost of approximately ~~$9.1~~$13.4 billion. Due to COVID-19, the Company has temporarily suspended share repurchase.

Net Income Per Share

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



	Three Months Ended March 31,
	2020	2019
Basic weighted average ordinary shares outstanding	233.2	242.2
Dilutive effect of potentially issuable shares	1.3	1.5
Diluted weighted average ordinary shares outstanding	234.5	243.7

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

Potentially issuable shares are not included in the computation of ~~diluted~~Diluted net income per share if their inclusion would be antidilutive. There were no0 shares and 0.1 million shares excluded from the calculation for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2020 and ~~2016.~~March 31, 2019, respectively.

Accumulated Other Comprehensive Loss

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

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

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



	Change in Fair Value of Financial Instruments ⁽¹⁾			Foreign Currency Translation Adjustments			Postretirement Benefit Obligation ⁽²⁾			Total
Balance at December 31, 2019	$	(12	)	$	(1,305	)	$	(2,716	)	$	(4,033	)
Other comprehensive income (loss) before reclassifications, net	(9		)	(395		)	1			(403		)
Amounts reclassified from accumulated other comprehensive income
Amounts reclassified from accumulated other comprehensive income	5			—			30			35
Tax expense	(1		)	—			(7		)	(8		)
Amounts reclassified from accumulated other comprehensive income, net⁽³⁾	4			—			23			27
Net current period other comprehensive income (loss)	(5		)	(395		)	24			(376		)
Balance at March 31, 2020	$	(17	)	$	(1,700	)	$	(2,692	)	$	(4,409	)

(1)

Reclassifications from this category included in Accumulated other comprehensive loss are recorded in ~~Other income (expense), Other general expenses,~~Revenue, Interest expense, and Compensation and ~~benefits. See~~benefits in the Condensed Consolidated Statements of Income. Refer to Note 14 “Derivatives and Hedging” for ~~additional~~further information regarding the Company’s derivative and hedging activity.


(2)	Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Other income (expense) in the Condensed Consolidated Statements of Income.


(3)	It is the Company’s policy to release income tax effects from accumulated other comprehensive loss using the portfolio approach.



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


(1)	Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Revenue, Interest expense, and Compensation and ~~benefits.~~benefits in the Condensed Consolidated Statements of Income. Refer to Note 14 “Derivatives and Hedging” for further information regarding the Company’s derivative and hedging activity.


(2)	Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Other income (expense) in the Condensed Consolidated Statements of Income.


(3)	It is the Company’s policy to release income tax effects from accumulated other comprehensive loss using the portfolio approach.

12. Employee Benefits

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



	Three Months Ended March 31,
	U.K.						U.S.						Other
	2020			2019			2020			2019			2020			2019
Service cost	$	—		$	—		$	—		$	—		$	—		$	—
Interest cost	22			28			21			27			4			7
Expected return on plan assets, net of administration expenses	(39		)	(49		)	(33		)	(34		)	(8		)	(10		)
Amortization of prior-service cost	—			1			—			1			—			—
Amortization of net actuarial loss	7			7			17			13			3			3
Total net periodic (benefit) cost	$	(10	)	$	(13	)	$	5		$	7		$	(1	)	$	—

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

$ 2

$ (3 )
$ (2 )

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

In March 2017, the Company approved a plan to offer a voluntary one-time lump sum payment option to certain eligible employees of the Company’s U.K. pension plans that, if accepted, would settle the Company’s pension obligation to them. A non-cash settlement charge is expected in the fourth quarter of 2017.

Contributions

~~The~~Assuming no additional contributions are agreed to with, or required by, the pension plan trustees, the Company expects to make total cash contributions of approximately ~~$80~~$5 million, ~~$51~~$99 million, and ~~$18~~$19 million, ~~based on exchange rates as of~~(at December 31, ~~2016,~~2019 exchange rates) to its significant U.K., U.S., and other ~~significant international~~major pension plans, respectively, during ~~2017. During the three months ended September 30, 2017, cash~~2020. The following table summarizes contributions ~~of $22 million, $5 million, and $3 million were~~ made to the Company’s significant ~~U.K., U.S., and other significant international~~ pension plans respectively. During the nine months ended September 30, 2017, cash contributions of $64 million, $31 million, and $14 million were made to the Company’s significant U.K., U.S., and other significant international pension plans, respectively. During the three and nine months ended September 30, 2017, Aon made a non-cash contribution of approximately $80 million to its U.S. pension plan.(in millions):

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



	Three Months Ended March 31,
	2020		2019
Contributions to U.K. pension plans	$	2	$	23
Contributions to U.S. pension plans	31		17
Contributions to other major pension plans	2		7
Total contributions	$	35	$	47

13. Share-Based Compensation Plans

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



	Three Months Ended March 31,
	2020		2019
Restricted share units (“RSUs”)	$	58	$	63
Performance share awards (“PSAs”)	14		23
Employee share purchase plans	4		3
Total share-based compensation expense	$	76	$	89

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

Restricted Share Units

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

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



	Three Months Ended March 31,
	2020				2019
	Shares		Fair Value ⁽¹⁾		Shares		Fair Value ⁽¹⁾
Non-vested at beginning of period	3,634		$	143	4,208		$	120
Granted	432		$	179	517		$	170
Vested	(583	)	$	141	(677	)	$	117
Forfeited	(79	)	$	146	(41	)	$	121
Non-vested at end of period	3,403		$	147	4,007		$	127

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


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

Unamortized deferred compensation expense amounted to ~~$367~~$359 million as of ~~September 30, 2017,~~March 31, 2020, with a remaining ~~weighted-average~~weighted average amortization period of approximately ~~2.1~~two years.

Performance Share Awards

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

~~Information as of September 30, 2017 regarding~~The following table summarizes the Company’s target PSAs granted and shares that would be issued at current performance levels for PSAs granted during the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2020 and the years ended December 31, ~~2016~~2019 and ~~2015,~~2018, respectively ~~is as follows~~ (shares in thousands and dollars in millions, except fair value):



	March 31, 2020		December 31, 2019		December 31, 2018
Target PSAs granted during period	487		467		564
Weighted average fair value per share at date of grant	$	160	$	165	$	134
Number of shares that would be issued based on current performance levels	487		451		818
Unamortized expense, based on current performance levels	$	78	$	42	$	24

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

14. Derivatives and Hedging

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

Foreign Exchange Risk Management

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

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

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


	Notional Amount				Derivative Assets ⁽¹⁾				Derivative Liabilities ⁽²⁾				Notional Amount				Net Amount of Derivative Assets Presented in the Statements of Financial Position ⁽¹⁾				Net Amount of Derivative Liabilities Presented in the Statements of Financial Position ⁽²⁾
	September 30, 2017		December 31, 2016		September 30, 2017		December 31, 2016		September 30, 2017		December 31, 2016		March 31, 2020		December 31, 2019		March 31, 2020		December 31, 2019		March 31, 2020			December 31, 2019
Foreign exchange contracts
Accounted for as hedges	$	711	$	758	$	31	$	14	$	3	$	13	$	537	$	579	$	8	$	16	$	(3	)	$	1
Not accounted for as hedges ⁽³⁾	245		189		—		1		2		1		385		297		4		2		(1		)	—
Total	$	956	$	947	$	31	$	15	$	5	$	14	$	922	$	876	$	12	$	18	$	(4	)	$	1


(1)	Included within Other current assets ($67 million at ~~September 30, 2017~~March 31, 2020 and $6$7 million at December 31, ~~2016)~~2019) or Other non-current assets ($255 million at ~~September 30, 2017~~March 31, 2020 and $9$11 million at December 31, ~~2016)~~2019).


(2)	Included within Other current liabilities ($3 million at ~~September 30, 2017~~March 31, 2020 and $7$1 million at December 31, ~~2016)~~2019) or Other non-current liabilities ($21 million at ~~September 30, 2017~~March 31, 2020 and $7$0 million at December 31, ~~2016)~~2019).


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

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

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


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

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

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


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

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

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

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



	Three Months Ended March 31,
	2020			2019
(Loss) Gain recognized in Accumulated other comprehensive loss	$	(11	)	$	4

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



	Three Months Ended March 31,
	2020			2019
Total revenue	$	(4	)	$	(4	)
Interest expense	(1		)	(1		)
Total	$	(5	)	$	(5	)

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

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

The Company estimates that approximately ~~$11~~$14 million of pretax losses currently included within Accumulated other comprehensive loss will be reclassified ~~in to~~into earnings in the next ~~twelve~~12 months.

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

~~During the three and nine months ended September 30, 2017, the~~ Company recorded a loss of $35 million and a gain of $8$5 million ~~and $9 million, respectively,~~ in Other income (expense) during the three months ended March 31, 2020 and March 31, 2019, respectively, for foreign exchange derivatives not designated or qualifying as hedges. During the three and nine months ended September 30, 2016, the Company recorded a gain of $2 million and $1 million, respectively, in Other income (expense) for foreign exchange derivatives not designated or qualifying as hedges.

Net Investments in Foreign Operations Risk Management

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

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

~~As of September 30, 2017, the~~The Company had no€101 million ($112 million at March 31, 2020 exchange rates) and €101 million ($112 million at December 31, 2019 exchange rates) of outstanding ~~Euro-denominated~~euro-denominated commercial paper at March 31, 2020 and December 31, 2019, respectively, designated as a hedge of the foreign currency exposure of its net investment in its European operations. ~~As of September 30, 2017, the~~The unrealized gain recognized in Accumulated other comprehensive ~~income (loss)~~loss related to the net investment ~~non derivative~~non-derivative hedging instrument was ~~immaterial.~~$30 million and $29 million, as of March 31, 2020 and December 31, 2019, respectively.

The Company did not reclassify any deferred gains or losses related to net investment hedges from Accumulated other comprehensive ~~income (loss)~~loss to earnings during the three ~~and nine~~ months ended ~~September 30, 2017. In addition, the Company did not incur any ineffectiveness related to net investment hedges during the three~~March 31, 2020 and ~~nine months ended September 30, 2017.~~2019.

15. Fair Value Measurements and Financial Instruments

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

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

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

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

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

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

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

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

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

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

The following tables present the categorization of the Company’s assets and liabilities that are measured at fair value on a recurring basis at ~~September 30, 2017~~March 31, 2020 and December 31, ~~2016~~2019 (in millions):



			Fair Value Measurements Using
	Balance at March 31, 2020		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money market funds ⁽¹⁾	$	2,252	$	2,252	$	—	$	—
Other investments
Government bonds	$	1	$	—	$	1	$	—
Equity investments	$	1	$	—	$	1	$	—
Derivatives ⁽²⁾
Gross foreign exchange contracts	$	13	$	—	$	13	$	—
Liabilities
Derivatives ⁽²⁾
Gross foreign exchange contracts	$	5	$	—	$	5	$	—

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

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

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

Foreign exchange contracts 31
—
31
—
Liabilities:

Derivatives: ⁽²⁾

Foreign exchange contracts 5
—
5
—



			Fair Value Measurements Using
	Balance at December 31, 2019		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money market funds ⁽¹⁾	$	2,007	$	2,007	$	—	$	—
Other investments
Government bonds	$	1	$	—	$	1	$	—
Equity investments	$	1	$	—	$	1	$	—
Derivatives ⁽²⁾
Gross foreign exchange contracts	$	21	$	—	$	21	$	—
Liabilities					0
Derivatives ⁽²⁾
Gross foreign exchange contracts	$	4	$	—	$	4	$	—


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


(2)	Refer to Note 14 “Derivatives and Hedging” for additional information regarding the Company’s derivatives and hedging activity.

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

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

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

Foreign exchange contracts 15
—
15
—
Liabilities:

Derivatives: ⁽²⁾

Foreign exchange contracts 14
—
14
—


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


~~(2)~~	~~Refer to Note 14 “Derivatives and Hedging” for additional information regarding the Company’s derivatives and hedging activity.~~

There were no transfers of assets or liabilities between fair value hierarchy levels in ~~either~~ the three ~~and nine~~ months ended ~~September 30, 2017 or 2016.~~March 31, 2020 and 2019. The Company recognized no realized or unrealized gains or losses in the Condensed Consolidated Statements of Income during ~~either~~ the three ~~and nine~~ months ended ~~September 30, 2017 or 2016,~~March 31, 2020 and 2019 related to assets and liabilities measured at fair value using unobservable inputs.

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



	March 31, 2020				December 31, 2019
	Carrying Value		Fair Value		Carrying Value		Fair Value
Current portion of long-term debt	$	999	$	1,004	$	600	$	614
Long-term debt	$	6,227	$	6,837	$	6,627	$	7,442

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


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

16. ~~Commitments~~Claims, Lawsuits, and Other Contingencies

Legal

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

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

Current Matters

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

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

agreement was entered. The High Court decision says that the additional liabilities in the pension fund resulting from the alleged defect in governing documents amount to approximately £45 million ($61 million at September 30, 2017 exchange rates). In December 2014, the Court of Appeal granted the employer leave to appeal the High Court decision. At a hearing in October 2016, the Court of Appeal approved a settlement of the pending litigation. On October 31, 2016, the fund’s trustees and employer sued Aon in the High Court, Chancery Division, London, alleging negligence and breach of duty in relation to the governing documents. The proceedings were served on Aon on December 20, 2016. The claimants seek damages of approximately £70 million ($94 million at September 30, 2017 exchange rates). Aon believes that it has meritorious defenses and intends to vigorously defend itself against this claim.

On June 29, 2015, Lyttelton Port Company Limited (“LPC”) sued Aon New Zealand in the Christchurch Registry of the High Court of New Zealand. LPC alleges, among other things, that Aon was negligent and in breach of contract in arranging LPC’s property insurance program for the period covering June 30, 2010, to June 30, 2011. LPC contends that acts and omissions by Aon caused LPC to recover less than it otherwise would have from insurers for losses suffered in the 2010 and 2011 Canterbury earthquakes. LPC claims damages of approximately NZD 184 million ($133 million at September 30, 2017 exchange rates) plus interest and costs. Aon believes that it has meritorious defenses and intends to vigorously defend itself against these claims.

On October 3, 2017, Christchurch City Council (“CCC”) invoked arbitration to pursue a claim that it asserts against Aon New Zealand. Aon provided insurance broking services to CCC in relation to CCC’s 2010-2011 material damage and business interruption program. In December 2015, CCC settled its property and business interruption claim for its losses arising from the 2010-2011 Canterbury earthquakes against the underwriter of its material damage and business interruption program and the reinsurers of that underwriter. CCC contends that acts and omissions by Aon caused CCC to recover less in that settlement than it otherwise would have. CCC claims damages of approximately NZD 528 million ($~~381~~315 million at ~~September 30, 2017~~March 31, 2020 exchange rates) plus interest and costs. Aon believes that it has meritorious defenses and intends to vigorously defend itself against these claims.

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

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

Aon UK Limited, an indirect wholly-owned subsidiary of the Company, is presently engaged in several internal regulatory reviews and ongoing interactions with the FCA concerning Aon UK Limited’s systems and controls. These interactions may result in additional charges above amounts accrued for to date in connection with these reviews.

~~Settled/Closed Matters~~

On June 1, 2007, the International Road Transport Union (“IRU”) sued Aon in the Geneva Tribunal of First Instance in Switzerland. IRU alleges, among other things, that, between 1995 and 2004, a business acquired by Aon and, later, an Aon subsidiary (1) accepted commissions for certain insurance placements that violated a fee agreement entered between the parties and (2) negligently failed to ask certain insurance carriers to contribute to the IRU’s risk management costs. IRU sought damages of approximately CHF 46 million ($47 million at June 30, 2017 exchange rates) and $3 million, plus legal fees and interest of approximately $30 million. On December 2, 2014, the Geneva Tribunal of First Instance entered a judgment that accepted some, and rejected other, of IRU’s claims. The judgment awarded IRU CHF 16.8 million ($17 million at June 30, 2017 exchange rates) and $3.1 million, plus interest and adverse costs. The entire amount of the judgment, including interest through December 31, 2014, totaled CHF 27.9 million ($28 million at December 31, 2014 exchange rates) and $5 million. On January 26, 2015, in return for IRU agreeing not to appeal the bulk of its dismissed claims, the Aon subsidiary agreed not to appeal a part of the judgment and to pay IRU CHF 12.8 million ($14 million at January 31, 2015 exchange rates) and $4.7 million without Aon admitting liability. The Aon subsidiary appealed those aspects of the judgment it retained the right to appeal. IRU did not appeal. After the Geneva Appellate Court affirmed the judgment of the Geneva Tribunal of First Instance, the Aon subsidiary filed an appeal with the Swiss Federal Tribunal. By judgment issued June 16, 2017, the Swiss Federal Tribunal affirmed in part and reversed in part the appellate judgment and remanded the case to the appellate court. IRU and the Aon subsidiary agreed that the Aon subsidiary would pay IRU CHF 15.0 million ($15 million at June 30, 2017 exchange rates) and $344,000. As a result of this agreement, the legal proceedings between IRU and the Aon subsidiary have been discontinued.

Guarantees and Indemnifications

~~Redomestication~~

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

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

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

Guarantee of Registered Securities

See Note 18 “Guarantee of Registered Securities” for information regarding the Company’s guarantees of obligations of its subsidiaries arising under issued and outstanding debt securities.

Sale of the Divested Business

In connection with the sale of the Divested Business, the Company guaranteed future operating lease commitments related to certain facilities assumed by the Buyer. The Company is obligated to perform under the guarantees if the Divested Business defaults on such leases at any time during the remainder of the lease agreements, which expire on various dates through ~~2024.~~2025. As of ~~September 30, 2017,~~March 31, 2020, the undiscounted maximum potential future payments under the lease guarantee is ~~$104~~$66 million, with an estimated fair value of ~~$25~~$11 million. NoNaN cash payments were made in connection to the lease commitments during the three ~~or nine~~ months ended ~~September 30, 2017.~~March 31, 2020.

Additionally, the Company is subject to performance guarantee requirements under certain client arrangements that were assumed by the Buyer. Should the Divested Business fail to perform as required by the terms of the arrangements, the Company would be required to fulfill the remaining contract terms, which expire on various dates through 2023. As of ~~September 30, 2017,~~March 31, 2020, the undiscounted maximum potential future payments under the performance guarantees were ~~$395~~$139 million, with an estimated fair value of $4$1 million. NoNaN cash payments were made in connection to the performance guarantees during the three ~~or nine~~ months ended ~~September 30, 2017.~~March 31, 2020.

Letters of Credit

Aon has entered into a number of arrangements whereby the Company’s performance on certain obligations is guaranteed by a third party through the issuance of letters of credit (“LOCs”). The Company had total LOCs outstanding of approximately ~~$94~~$71 million at ~~September 30, 2017,~~March 31, 2020, compared to ~~$90~~$73 million at December 31, ~~2016.~~2019. These ~~letters of credit~~LOCs cover the beneficiaries related to certain of Aon’s U.S. and Canadian non-qualified pension plan schemes and secure deductible retentions for Aon’s own workers compensation program. The Company has also obtained LOCs to cover contingent payments for taxes and other business obligations to third parties, and other guarantees for miscellaneous purposes at its international subsidiaries.

Premium Payments

The Company has certain contractual contingent guarantees for premium payments owed by clients to certain insurance companies. The maximum exposure with respect to such contractual contingent guarantees was approximately ~~$76~~$70 million at ~~September 30, 2017~~March 31, 2020 compared to ~~$95~~$110 million at December 31, ~~2016.~~2019.

17. Segment Information

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

operates as ~~one~~1 segment that includes all of Aon’s continuing operations, which as a global professional services firm provides advice and solutions to clients focused on risk, retirement, and health through ~~five~~5 revenue lines which make up its principal products and services. The ~~CODM~~Chief Operating Decision Maker (the “CODM”) assesses the performance of the Company and allocates resources based on ~~one company:~~1 segment: Aon United.

The Company’s reportable operating segment has been determined using a management approach, which is consistent with the basis and manner in which ~~Aon’s~~the CODM uses financial information for the purposes of allocating resources and evaluating performance. The CODM assesses performance and allocates resources based on total Aon results against its key ~~four~~4 metrics, including organic revenue growth, expense discipline, and collaborative behaviors, that maximize value for Aon and its shareholders, regardless of which revenue line it benefits.

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

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

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

As Aon ~~is operating~~operates as ~~one~~1 segment, segment profit or loss is consistent with consolidated reporting as disclosed onin the Condensed Consolidated Statements of Income.

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

18. Guarantee of Registered Securities

~~As described in Note 16 “Commitments and Contingencies,” in~~In connection with the ~~Redomestication, Aon plc~~Company’s 2012 redomestication to the U.K. (the “2012 Redomestication”), the Company on April 2, 2012 entered into various agreements pursuant to which it agreed to guarantee the obligations of its subsidiaries arising under issued and outstanding debt securities. Those agreements included the: (1) Amended and Restated Indenture, dated April 2, 2012, among Aon Corporation, Aon UK, and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”) (amending and restating the Indenture, dated September 10, 2010, between Aon Corporation and the Trustee); (2) Amended and Restated Indenture, dated April 2, 2012, among Aon Corporation, Aon UK and the Trustee (amending and restating the Indenture, dated December 16, 2002, between Aon Corporation and the Trustee); and (3) Amended and Restated Indenture, dated April 2, 2012, among Aon Corporation, Aon UK and the Trustee (amending and restating the Indenture, dated January 13, 1997, between Aon Corporation and the Trustee, as supplemented by the First Supplemental Indenture, dated January 13, 1997).

In connection with the Ireland Reorganization, on April 1, 2020 Aon Ireland and Aon Global Holdings Limited, a company incorporated under the laws of England and Wales, entered into various agreements pursuant to which they agreed to guarantee the obligations of Aon Corporation arising under issued and outstanding debt securities, which were previously guaranteed solely by Aon UK, including ~~the~~the: 5.00% Notes due September ~~2020, the~~2020; 2.20% Notes due November 2022; 8.205% Notes due January ~~2027,~~2027; 4.50% Senior Notes due December 2028; 3.75% Senior Notes due May 2029; and ~~the~~ 6.25% Notes due September 2040 (collectively, the “Aon ~~Corp Notes”)~~Corporation Notes). Aon Corporation, ~~is a 100% indirectly~~Aon UK, and Aon Global Holdings Limited are indirect wholly owned ~~subsidiary~~subsidiaries of Aon ~~plc.~~Ireland. All guarantees of Aon ~~plc~~Ireland, Aon UK, and Aon Global Holdings Limited of the Aon Corporation Notes are joint and several as well as full and unconditional. There are no subsidiaries other ~~subsidiaries of Aon plc~~than those listed above that ~~are guarantors of~~guarantee the Aon ~~Corp~~Corporation Notes.

In addition, in connection with the Ireland Reorganization, on April 1, 2020 Aon ~~Corporation~~Ireland and Aon Global Holdings Limited entered into ~~an agreement~~various agreements pursuant to which ~~it agreed to guarantee~~they guaranteed the obligations of Aon ~~plc~~UK arising under ~~the~~issued and outstanding debt securities, which were previously guaranteed solely by Aon Corporation, including the: 4.25% Notes due December 2042 exchanged for Aon Corporation’s ~~outstanding~~ 8.205% Notes due January ~~2027, and also agreed to guarantee the obligations of Aon plc arising under the~~2027; 4.45% Notes due ~~2043, the~~May 2043; 4.00% Notes due November ~~2023, the~~2023; 2.875% Notes due May ~~2026, the~~2026; 3.50% Notes due June ~~2024, the~~2024; 4.60% Notes due June ~~2044, the~~2044; 4.75% Notes due May ~~2045, the~~2045; 2.80% Notes due March ~~2021,~~2021; and ~~the~~ 3.875% Notes due December 2025 (collectively, the “Aon ~~plc~~UK Notes”). ~~In each case, the guarantee~~All guarantees of Aon Ireland, Aon Global Holdings Limited, and Aon Corporation isof the Aon UK Notes are joint and several as well as full and unconditional. There are no subsidiaries ~~of Aon plc,~~ other than those listed above that guarantee the Aon UK Notes.

The Company has reflected these new guarantees in the Condensed Consolidating Statements of Income, Condensed Consolidating Statements of Comprehensive Income, and Condensed Consolidating Statements of Cash Flows for the three months ended March 31, 2020 and 2019, and in the Condensed Consolidating Statements of Financial Position as of March 31, 2020 and December 31, 2019.

In 2019, Aon Corporation obtained indirect ownership of subsidiaries that were previously indirectly owned by Aon UK. The financial results of both subsidiaries are ~~guarantors~~included in the Other Non-Guarantor Subsidiaries column of the Condensed Consolidating Financial Statements.

Aon Ireland was not part of the Aon ~~plc Notes. As a result~~group until November 2019, therefore no balances are reflected in the Condensed Consolidating Statement of Income, Condensed Consolidating Statement of Comprehensive Income, and the ~~existence~~Condensed Consolidating Statement of ~~these guarantees,~~Cash Flows for the ~~Company has elected to present the financial information set forth in this footnote in accordance with Rule 3-10 of Regulation S-X.~~period ended March 31, 2019.

The following tables set forth the Condensed Consolidating Statements of Income ~~for the three~~ and ~~nine months ended September 30, 2017 and 2016,~~ Condensed Consolidating Statements of Comprehensive Income for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2020 and ~~2016,~~2019, Condensed Consolidating Statements of Financial Position as of ~~September 30, 2017~~March 31, 2020 and December 31, ~~2016,~~2019, and Condensed Consolidating Statements of Cash Flows for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2020 and ~~2016~~2019, in accordance with Rule 3-10 of Regulation S-X. The ~~condensed consolidating financial information~~Condensed Consolidating Financial Information includes the accounts of Aon ~~plc,~~Ireland, the accounts of Aon UK, the accounts of Aon Global Holdings Limited, the accounts of Aon Corporation, and the combined accounts of the ~~non-guarantor subsidiaries.~~Other Non-Guarantor Subsidiaries. The ~~condensed consolidating financial statements~~Condensed Consolidating Financial Statements are presented in all periods as a merger under common ~~control, with Aon plc presented as the parent company in all periods prior and subsequent to the Redomestication.~~control. The principal consolidating adjustments are to eliminate the investment in subsidiaries and intercompany balances and transactions.

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

Condensed Consolidating Statement of Income


	Three months ended September 30, 2017
								Other
	Aon				Aon			Non-Guarantor			Consolidating						Three Months Ended March 31, 2020
(millions)	plc				Corporation			Subsidiaries			Adjustments			Consolidated			Aon Ireland		Aon UK			Aon Global Holdings Limited			Aon Corporation			Other Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Revenue
Total revenue	$	—			$	—		$	2,340		$	—		$	2,340		$	—	$	—		$	—		$	—		$	3,219		$	—		$	3,219
Expenses
Compensation and benefits	25				20			1,374			—			1,419			—		12			—			(12		)	1,522			—			1,522
Information technology	—				—			109			—			109			—		—			—			—			111			—			111
Premises	—				—			89			—			89			—		—			—			5			68			—			73
Depreciation of fixed assets	—				—			40			—			40			—		—			—			—			41			—			41
Amortization and impairment of intangible assets	—				—			101			—			101			—		—			—			—			97			—			97
Other general expenses (income)	1				1			315			—			317
Other general expense																	—		26			—			1			315			—			342
Total operating expenses	26				21			2,028			—			2,075			—		38			—			(6		)	2,154			—			2,186
Operating income (loss)	(26		)		(21		)	312			—			265			—		(38		)	—			6			1,065			—			1,033
Interest income	—				18			—			(8		)	10			—		—			—			10			14			(22		)	2
Interest expense	(53		)		(24		)	(1		)	8			(70		)	—		(54		)	(11		)	(39		)	(1		)	22			(83		)
Intercompany interest income (expense)	3				(135		)	132			—			—			—		8			—			(113		)	105			—			—
Intercompany other income (expense)	291				(271		)	(20		)	—			—			—		81			—			(128		)	47			—			—
Other income (expense)	(2		)		14			(17		)	—			(5		)	—		—			—			(42		)	72			(1		)	29
Income (loss) from continuing operations before income taxes	213				(419		)	406			—			200			—		(3		)	(11		)	(306		)	1,302			(1		)	981
Income tax benefit (expense)	(8		)		(81		)	93			—			4
Income tax expense (benefit)																	—		(17		)	(2		)	(48		)	256			—			189
Net income (loss) from continuing operations	221				(338		)	313			—			196			—		14			(9		)	(258		)	1,046			(1		)	792
Income (loss) from discontinued operations, net of tax	—				—			(4		)	—			(4		)
Net income (loss) from discontinued operations																	—		—			—			—			(1		)	—			(1		)
Net income (loss) before equity in earnings of subsidiaries	221				(338		)	309			—			192			—		14			(9		)	(258		)	1,045			(1		)	791
Equity in earnings of subsidiaries, net of tax	(36		)		122			(216		)	130			—
Equity in earnings of subsidiaries																	773		759			614			862			—			(3,008		)	—
Net income	185				(216		)	93			130			192			773		773			605			604			1,045			(3,009		)	791
Less: Net income attributable to noncontrolling interests	—			��	—			7			—			7			—		—			—			—			19			—			19
Net income (loss) attributable to Aon shareholders	$	185			$	(216	)	$	86		$	130		$	185
Net income attributable to Aon shareholders																	$	773	$	773		$	605		$	604		$	1,026		$	(3,009	)	$	772

Condensed Consolidating Statement of Income


	Three months ended September 30, 2016
							Other
	Aon			Aon			Non-Guarantor			Consolidating						Three Months Ended March 31, 2019
(millions)	plc			Corporation			Subsidiaries			Adjustments			Consolidated			Aon Ireland		Aon UK			Aon Global Holdings Limited			Aon Corporation			Other Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Revenue
Total revenue	$	—		$	—		$	2,201		$	—		$	2,201		$	—	$	—		$	—		$	—		$	3,143		$	—		$	3,143
Expenses
Compensation and benefits	25			4			1,271			—			1,300			—		20			—			8			1,556			—			1,584
Information technology	—			—			99			—			99			—		—			—			—			117			—			117
Premises	—			—			86			—			86			—		—			—			4			83			—			87
Depreciation of fixed assets	—			—			39			—			39			—		—			—			—			40			—			40
Amortization and impairment of intangible assets	—			—			42			—			42			—		—			—			—			97			—			97
Other general expenses (income)	(1		)	3			265			—			267
Other general expense																—		—			—			1			345			—			346
Total operating expenses	24			7			1,802			—			1,833			—		20			—			13			2,238			—			2,271
Operating income (loss)	(24		)	(7		)	399			—			368			—		(20		)	—			(13		)	905			—			872
Interest income	—			4			5			(8		)	1			—		—			—			9			20			(27		)	2
Interest expense	(51		)	(24		)	(3		)	8			(70		)	—		(46		)	(24		)	(28		)	(1		)	27			(72		)
Intercompany interest income (expense)	3			(135		)	132			—			—			—		4			—			(116		)	112			—			—
Intercompany other income (expense)	328			(277		)	(51		)	—			—			—		31			—			(94		)	63			—			—
Other income (expense)	(5		)	1			11			3			10			—		5			—			(11		)	8			(2		)	—
Income (loss) from continuing operations before income taxes	251			(438		)	493			3			309			—		(26		)	(24		)	(253		)	1,107			(2		)	802
Income tax benefit (expense)	13			(93		)	105			—			25
Income tax expense (benefit)																—		(5		)	(5		)	(42		)	178			—			126
Net income (loss) from continuing operations	238			(345		)	388			3			284			—		(21		)	(19		)	(211		)	929			(2		)	676
Income (loss) from discontinued operations, net of tax	—			—			42			—			42
Net income (loss) from discontinued operations																—		—			—			—			—			—			—
Net income (loss) before equity in earnings of subsidiaries	238			(345		)	430			3			326			—		(21		)	(19		)	(211		)	929			(2		)	676
Equity in earnings of subsidiaries, net of tax	78			225			(120		)	(183		)	—
Equity in earnings of subsidiaries																—		682			619			724			—			(2,025		)	—
Net income	316			(120		)	310			(180		)	326			—		661			600			513			929			(2,027		)	676
Less: Net income attributable to noncontrolling interests	—			—			7			—			7			—		—			—			—			17			—			17
Net income (loss) attributable to Aon shareholders	$	316		$	(120	)	$	303		$	(180	)	$	319
Net income attributable to Aon shareholders																$	—	$	661		$	600		$	513		$	912		$	(2,027	)	$	659

~~Condensed Consolidating Statement of Income~~

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

~~Condensed Consolidating Statement of Income~~

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

Condensed Consolidating Statement of Comprehensive Income


	Three months ended September 30, 2017
						Other
	Aon		Aon			Non-Guarantor		Consolidating					Three Months Ended March 31, 2020
(millions)	plc		Corporation			Subsidiaries		Adjustments			Consolidated		Aon Ireland			Aon UK			Aon Global Holdings Limited			Aon Corporation			Other Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Net income (loss)	$	185	$	(216	)	$	93	$	130		$	192
Net income													$	773		$	773		$	605		$	604		$	1,045		$	(3,009	)	$	791
Less: Net income attributable to noncontrolling interests	—		—			7		—			7		—			—			—			—			19			—			19
Net income (loss) attributable to Aon shareholders	185		(216		)	86		130			185
Net income attributable to Aon shareholders													773			773			605			604			1,026			(3,009		)	772
Other comprehensive income (loss), net of tax:
Change in fair value of financial instruments	—		3			8		—			11		—			—			—			(2		)	(3		)	—			(5		)
Foreign currency translation adjustments	—		—			243		—			243		—			—			—			—			(398		)	1			(397		)
Post-retirement benefit obligation	—		7			11		—			18
Postretirement benefit obligation													—			—			—			13			11			—			24
Total other comprehensive income (loss)	—		10			262		—			272		—			—			—			11			(390		)	1			(378		)
Equity in other comprehensive income (loss) of subsidiaries, net of tax	265		245			255		(765		)	—		(377		)	(377		)	(370		)	(381		)	—			1,505			—
Less: Other comprehensive income attributable to noncontrolling interests	—		—			7		—			7
Less: Other comprehensive loss attributable to noncontrolling interests													—			—			—			—			(2		)	—			(2		)
Total other comprehensive income (loss) attributable to Aon shareholders	265		255			510		(765		)	265		(377		)	(377		)	(370		)	(370		)	(388		)	1,506			(376		)
Comprehensive income (loss) attributable to Aon shareholders	$	450	$	39		$	596	$	(635	)	$	450
Comprehensive income attributable to Aon shareholders													$	396		$	396		$	235		$	234		$	638		$	(1,503	)	$	396

Condensed Consolidating Statement of Comprehensive Income



	Three Months Ended March 31, 2019
(millions)	Aon Ireland		Aon UK		Aon Global Holdings Limited		Aon Corporation		Other Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
Net income	$	—	$	661	$	600	$	513	$	929	$	(2,027	)	$	676
Less: Net income attributable to noncontrolling interests	—		—		—		—		17		—			17
Net income attributable to Aon shareholders	—		661		600		513		912		(2,027		)	659
Other comprehensive income (loss), net of tax:
Change in fair value of financial instruments	—		—		—		2		5		—			7
Foreign currency translation adjustments	—		—		—		—		131		2			133
Postretirement benefit obligation	—		—		—		22		9		—			31
Total other comprehensive income (loss)	—		—		—		24		145		2			171
Equity in other comprehensive income (loss) of subsidiaries, net of tax	—		167		139		115		—		(421		)	—
Less: Other comprehensive loss attributable to noncontrolling interests	—		—		—		—		2		—			2
Total other comprehensive income (loss) attributable to Aon shareholders	—		167		139		139		143		(419		)	169
Comprehensive income attributable to Aon shareholders	$	—	$	828	$	739	$	652	$	1,055	$	(2,446	)	$	828

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

~~Condensed Consolidating Statement of Comprehensive Income~~

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

~~Condensed Consolidating Statement of Comprehensive Income~~

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

Condensed Consolidating Statement of Financial Position


	As of September 30, 2017
					Other
	Aon		Aon		Non-Guarantor		Consolidating					As of March 31, 2020
(millions)	plc		Corporation		Subsidiaries		Adjustments			Consolidated		Aon Ireland		Aon UK		Aon Global Holdings Limited		Aon Corporation			Other Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
ASSETS
CURRENT ASSETS
Assets
Current assets
Cash and cash equivalents	$	—	$	3,110	$	802	$	(3,163	)	$	749	$	—	$	—	$	36	$	194		$	1,698	$	(1,238	)	$	690
Short-term investments	—		1,467		173		—			1,640		—		—		—		57			113		—			170
Receivables, net	—		2		2,066		—			2,068		—		—		—		—			3,554		—			3,554
Fiduciary assets	—		—		9,292		—			9,292		—		—		—		—			12,401		—			12,401
Intercompany receivables	110		4,860		12,436		(17,406		)	—
Current intercompany receivables												—		208		90		2,710			14,875		(17,883		)	—
Other current assets	—		37		481		—			518		—		—		—		4			526		—			530
Current assets of discontinued operations	—		—		—		—			—
Total Current Assets	110		9,476		25,250		(20,569		)	14,267
Total current assets												—		208		126		2,965			33,167		(19,121		)	17,345
Goodwill	—		—		7,888		—			7,888		—		—		—		—			8,293		—			8,293
Intangible assets, net	—		—		1,341		—			1,341		—		—		—		—			746		—			746
Fixed assets, net	—		—		545		—			545		—		—		—		—			666		—			666
Operating lease right-of-use assets												—		—		—		103			794		—			897
Deferred tax assets	135		664		173		(407		)	565		—		89		4		589			150		(194		)	638
Intercompany receivables	391		261		8,728		(9,380		)	—
Prepaid pension	—		5		1,015		—			1,020		—		—		—		7			1,157		—			1,164
Non-current intercompany receivables												—		397		—		261			7,044		(7,702		)	—
Other non-current assets	1		49		248		—			298		—		—		—		25			508		—			533
Investment in subsidiary	11,900		17,748		509		(30,157		)	—		3,169		8,650		8,871		19,973			—		(40,663		)	—
Non-current assets of discontinued operations	—		—		—		—			—
TOTAL ASSETS	$	12,537	$	28,203	$	45,697	$	(60,513	)	$	25,924
Total assets												$	3,169	$	9,344	$	9,001	$	23,923		$	52,525	$	(67,680	)	$	30,282

LIABILITIES AND EQUITY
LIABILITIES
CURRENT LIABILITIES
Liabilities and equity
Liabilities														��
Current liabilities
Accounts payable and accrued liabilities	$	2,929	$	37	$	1,785	$	(3,163	)	$	1,588	$	—	$	1,345	$	—	$	49		$	1,393	$	(1,238	)	$	1,549
Short-term debt and current portion of long-term debt	—		—		305		—			305		—		696		—		1,136			52		—			1,884
Fiduciary liabilities	—		—		9,292		—			9,292		—		—		—		—			12,401		—			12,401
Intercompany payables	147		15,951		1,308		(17,406		)	—
Current intercompany payables												—		310		61		16,321			1,191		(17,883		)	—
Other current liabilities	24		54		1,211		—			1,289		—		—		—		82			1,195		—			1,277
Current liabilities of discontinued operations	—		—		—		—			—
Total Current Liabilities	3,100		16,042		13,901		(20,569		)	12,474
Total current liabilities												—		2,351		61		17,588			16,232		(19,121		)	17,111
Long-term debt	4,247		1,414		1		—			5,662		—		3,822		—		2,405			—		—			6,227
Non-current operating lease liabilities												—		—		—		136			774		—			910
Deferred tax liabilities	—		—		490		(407		)	83		—		—		—		—			383		(194		)	189
Pension, other post-retirement and other post-employment liabilities	—		1,234		378		—			1,612
Intercompany payables	—		8,894		486		(9,380		)	—
Pension, other postretirement, and postemployment liabilities												—		—		—		1,287			368		—			1,655
Non-current intercompany payables												—		—		—		7,210			492		(7,702		)	—
Other non-current liabilities	15		110		721		—			846		—		2		—		115			813		—			930
Non-current liabilities of discontinued operations	—		—		—		—			—
TOTAL LIABILITIES	7,362		27,694		15,977		(30,356		)	20,677
Total liabilities												—		6,175		61		28,741			19,062		(27,017		)	27,022

TOTAL AON SHAREHOLDERS’ EQUITY	5,175		509		29,648		(30,157		)	5,175
Equity
Total Aon shareholders’ equity												3,169		3,169		8,940		(4,818		)	33,372		(40,663		)	3,169
Noncontrolling interests	—		—		72		—			72		—		—		—		—			91		—			91
TOTAL EQUITY	5,175		509		29,720		(30,157		)	5,247
TOTAL LIABILITIES AND EQUITY	$	12,537	$	28,203	$	45,697	$	(60,513	)	$	25,924
Total equity												3,169		3,169		8,940		(4,818		)	33,463		(40,663		)	3,260
Total liabilities and equity												$	3,169	$	9,344	$	9,001	$	23,923		$	52,525	$	(67,680	)	$	30,282

Condensed Consolidating Statement of Financial Position



	As of December 31, 2019
(millions)	Aon Ireland		Aon UK		Aon Global Holdings Limited		Aon Corporation			Other Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
Assets
Current assets
Cash and cash equivalents	$	—	$	—	$	—	$	2,271		$	2,619	$	(4,100	)	$	790
Short-term investments	—		—		—		28			110		—			138
Receivables, net	—		—		—		—			3,112		—			3,112
Fiduciary assets	—		—		—		—			11,834		—			11,834
Current intercompany receivables	—		246		89		1,214			12,710		(14,259		)	—
Other current assets	—		—		—		7			595		—			602
Total current assets	—		246		89		3,520			30,980		(18,359		)	16,476
Goodwill	—		—		—		—			8,165		—			8,165
Intangible assets, net	—		—		—		—			783		—			783
Fixed assets, net	—		—		—		—			621		—			621
Operating lease right-of-use assets	—		—		—		110			819		—			929
Deferred tax assets	—		89		4		577			165		(190		)	645
Prepaid pension	—		—		—		7			1,209		—			1,216
Non-current intercompany receivables	—		868		—		261			7,046		(8,175		)	—
Other non-current assets	—		—		—		32			538		—			570
Investment in subsidiary	3,375		8,899		12,211		19,470			—		(43,955		)	—
Total assets	$	3,375	$	10,102	$	12,304	$	23,977		$	50,326	$	(70,679	)	$	29,405

Liabilities and equity
Liabilities
Current liabilities
Accounts payable and accrued liabilities	$	—	$	2,157	$	1,994	$	56		$	1,832	$	(4,100	)	$	1,939
Short-term debt and current portion of long-term debt	—		112		—		600			—		—			712
Fiduciary liabilities	—		—		—		—			11,834		—			11,834
Current intercompany payables	—		234		61		12,978			986		(14,259		)	—
Other current liabilities	—		—		—		80			1,006		—			1,086
Total current liabilities	—		2,503		2,055		13,714			15,658		(18,359		)	15,571
Long-term debt	—		4,223		—		2,404			—		—			6,627
Non-current operating lease liabilities	—		—		—		143			801		—			944
Deferred tax liabilities	—		—		—		—			389		(190		)	199
Pension, other postretirement, and postemployment liabilities	—		—		—		1,348			390		—			1,738
Non-current intercompany payables	—		—		—		7,212			963		(8,175		)	—
Other non-current liabilities	—		1		—		113			763		—			877
Total liabilities	—		6,727		2,055		24,934			18,964		(26,724		)	25,956

Equity
Total Aon shareholders’ equity	3,375		3,375		10,249		(957		)	31,288		(43,955		)	3,375
Noncontrolling interests	—		—		—		—			74		—			74
Total equity	3,375		3,375		10,249		(957		)	31,362		(43,955		)	3,449
Total liabilities and equity	$	3,375	$	10,102	$	12,304	$	23,977		$	50,326	$	(70,679	)	$	29,405

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

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

LIABILITIES AND EQUITY

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

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

Condensed Consolidating Statement of Cash Flows

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

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

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

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

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


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


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



	Three Months Ended March 31, 2020
(millions)	Aon Ireland		Aon UK			Aon Global Holdings Limited			Aon Corporation			Other Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Cash flows from operating activities
Cash provided by (used for) operating activities	$	—	$	1,561		$	3,648		$	(512	)	$	852		$	(5,211	)	$	338

Cash flows from investing activities
Proceeds from investments	—		—			—			2			4			—			6
Payments for investments	—		(450		)	(518		)	(30		)	(13		)	968			(43		)
Net sales (purchases) of short-term investments - non-fiduciary	—		—			—			(28		)	(10		)	—			(38		)
Acquisition of businesses, net of cash acquired	—		—			—			—			(334		)	—			(334		)
Sale of businesses, net of cash sold	—		—			—			—			30			—			30
Capital expenditures	—		—			—			—			(59		)	—			(59		)
Cash provided by (used for) investing activities	—		(450		)	(518		)	(56		)	(382		)	968			(438		)

Cash flows from financing activities
Share repurchase	—		(463		)	—			—			—			—			(463		)
Advances from (to) affiliates	—		(618		)	(3,094		)	(2,044		)	(1,349		)	7,105			—
Issuance of shares for employee benefit plans	—		(112		)	—			—			—			—			(112		)
Issuance of debt	—		457			—			1,603			—						2,060
Repayment of debt	—		(273		)	—			(1,068		)	—			—			(1,341		)
Cash dividends to shareholders	—		(102		)	—			—			—			—			(102		)
Noncontrolling interests and other financing activities	—		—			—			—			40			—			40
Cash provided by (used for) financing activities	—		(1,111		)	(3,094		)	(1,509		)	(1,309		)	7,105			82

Effect of exchange rate changes on cash and cash equivalents	—		—			—			—			(82		)	—			(82		)
Net increase (decrease) in cash and cash equivalents	—		—			36			(2,077		)	(921		)	2,862			(100		)
Cash and cash equivalents at beginning of period	—		—			—			2,271			2,619			(4,100		)	790
Cash and cash equivalents at end of period	$	—	$	—		$	36		$	194		$	1,698		$	(1,238	)	$	690

Condensed Consolidating Statement of Cash Flows



	Three Months Ended March 31, 2019
(millions)	Aon Ireland		Aon UK			Aon Global Holdings Limited			Aon Corporation			Other Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Cash flows from operating activities
Cash provided by (used for) operating activities	$	—	$	(11	)	$	529		$	(34	)	$	143		$	(553	)	$	74

Cash flows from investing activities
Proceeds from investments	—		—			72			8			4			(72		)	12
Payments for investments	—		—			—			(9		)	(77		)	72			(14		)
Net sales (purchases) of short-term investments - non-fiduciary	—		—			—			9			32			—			41
Acquisition of businesses, net of cash acquired	—		—			—			—			(15		)	—			(15		)
Sale of businesses, net of cash sold	—		—			—			—			6			—			6
Capital expenditures									—			(57		)	—			(57		)
Cash provided by (used for) investing activities	—		—			72			8			(107		)	—			(27		)

Cash flows from financing activities
Share repurchase	—		(100		)	—			—			—			—			(100		)
Advances from (to) affiliates	—		305			(601		)	(265		)	(550		)	1,111			—
Issuance of shares for employee benefit plans	—		(98		)	—			—			—			—			(98		)
Issuance of debt	—		384			—			485			2			—			871
Repayment of debt	—		(384		)	—			(310		)	—			—			(694		)
Cash dividends to shareholders	—		(96		)	—			—			—			—			(96		)
Noncontrolling interests and other financing activities	—		—			—			—			(23		)	—			(23		)
Cash provided by (used for) financing activities	—		11			(601		)	(90		)	(571		)	1,111			(140		)

Effect of exchange rate changes on cash and cash equivalents	—		—			—			—			37			—			37
Net increase (decrease) in cash and cash equivalents	—		—			—			(116		)	(498		)	558			(56		)
Cash and cash equivalents at beginning of period	—		—			—			862			3,473			(3,679		)	656
Cash and cash equivalents at end of period	$	—	$	—		$	—		$	746		$	2,975		$	(3,121	)	$	600

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

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

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

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

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


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


~~(2)~~	~~Includes $3 million of discontinued operations at September 30, 2016.~~

19. Subsequent Events

Ireland Reorganization

On April 1, 2020, a scheme of arrangement under English law was completed pursuant to which the Class A ordinary shares of Aon UK were cancelled and the holders thereof received, on a 1-for-one basis, Class A ordinary shares of Aon Ireland, as described in the proxy statement filed with the SEC on December 20, 2019. Equity incentive and compensation plans were assumed by Aon Ireland and amended to provide that those plans will now provide for the award and issuance of Class A ordinary shares of Aon Ireland instead of Class A ordinary shares of Aon UK, on a 1-for-one basis. Beginning on April 1, 2020, Aon Ireland’s principal executive office address is Metropolitan Building, James Joyce Street, Dublin 1, Ireland, not 122 Leadenhall Street, London, England. Aon Ireland is a tax resident of Ireland.

The Share Repurchase Program, which related to Class A ordinary shares of Aon UK and preceded the Ireland Reorganization, was adopted by Aon Ireland’s Board of Directors.

Commercial Paper

On April 1, 2020 the Company entered into an agreement increasing the aggregate outstanding borrowings under its U.S. commercial paper program by $300 million, to an aggregate amount equal to $900 million. The U.S. program remains fully backed by Aon’s committed credit facilities.

Colleague Compensatory Arrangements

On April 24, 2020, due to the COVID-19 pandemic and the resulting economic disruption, the Board of Directors of the Company determined to temporarily reduce the annual base salaries of the Company’s named executive officers and the cash compensation of each of the Company’s non-executive directors. Each of the named executive officers and non-executive directors have agreed to a temporary 50% reduction in his or her cash compensation from May 1, 2020 through December 31, 2020, or until such other date as decided by the Company.

Additionally, on April 27, 2020 the Company announced it will apply a temporary salary reduction of up to 20% to a broader colleague base. The reductions are being applied using a tailored approach based on a set of criteria, including considerations for cost-of-living, to determine the most equitable way to apply this temporary reduction.

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

EXECUTIVE SUMMARY OF ~~THIRD~~FIRST QUARTER ~~2017~~2020 FINANCIAL RESULTS

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

~~Discontinued Operations~~

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

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

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

~~Business Overview~~

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

~~Commercial Risk Solutions~~

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

~~Reinsurance Solutions~~

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

~~Retirement Solutions~~

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

~~Health Solutions~~

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

~~Data & Analytic Services~~

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

Financial Results

The following is a summary of our ~~third~~first quarter ~~and first nine months~~ of ~~2017~~2020 financial results from continuing ~~operations:~~operations.The first quarter 2020 financial results are not necessarily indicative of results that may be expected for the full year or any future period, particularly in light of the continuing effect of the COVID-19 outbreak.

For the ~~third~~first quarter of ~~2017,~~2020, revenue increased ~~6%,~~$76 million, or ~~$139 million, to $2.3 billion compared to the prior year period due primarily to a 3% increase related to acquisitions, net of divestitures, organic revenue growth of~~ 2%, ~~and a 1% favorable impact from foreign currency exchange rates. For the first nine months ended September 30, 2017, revenue increased 5%~~to $3.2 billion compared to the prior year period due primarily to organic revenue growth of ~~3% and a 3% increase related to acquisitions, net of divestitures,~~5%, partially offset by a 2% unfavorable impact from translating prior year period results at current period foreign exchange rates (“foreign currency translation”) and a 1% unfavorable impact related to divestitures, net of acquisitions.

Operating expenses for the first quarter of 2020 were $2.2 billion, a decrease of $85 million from the prior year period. The decrease was due primarily to a $91 million decrease in restructuring charges, a $40 million favorable impact from foreign currency ~~exchange rates.~~translation, and the preemptive reduction and deferral of certain discretionary expenses in an effort to proactively manage liquidity due to uncertainties surrounding COVID-19 and its impact to the Company, partially offset by $18 million of transaction costs related to the pending combination with WTW, an increase in investments supporting growth initiatives and Aon Business Services, and an increase in expense associated with 5% organic revenue growth.

Operating ~~expenses for~~margin increased to 32.1% in the ~~third~~first quarter of ~~2017 were $2.1 billion, an increase of $242 million compared to~~2020 from 27.7% in the prior year period. The increase was due primarily to $102 million of restructuring costs, a $62 million increase in operating expenses related to acquisitions, net of divestitures, $54 million of accelerated amortization related to tradenames, a $16 million unfavorable impact from foreign currency translation, $10 million of transaction related costs associated with recent acquisitions, and an increase in expense associated with 2% organic revenue growth, partially offsetdriven by $55 million of savings related to restructuring and other operational improvement initiatives. Operating expenses for the first nine months of 2017 increased $1,015 million compared to the prior year period primarily due to $401 million of restructuring costs, a $380 million non-cash impairment charge to the tradenames associated with the Divested Business, a $183 million

increase in operating expenses related to acquisitions, net of divestitures, $89 million of accelerated amortization related to tradenames to move to the one Aon United brand, $42 million of costs related to regulatory and compliance matters, and an increase in expense associated with organic revenue growth of 3%5%, ~~partially offset by $109 million of savings related to restructuring and other~~strong operational improvement, ~~initiatives,~~and a ~~$76 million favorable impact from foreign currency exchange rates, and $62 million of expense related to certain non-cash pension settlements in the prior year period.~~

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

Due to the factors set forth above, net income from continuing operations ~~decreased $88~~increased $116 million, or ~~31%~~17%, to ~~$196~~$792 million for the ~~third~~first quarter of ~~2017~~2020 compared to the prior year period. ~~During the first nine months of 2017, income~~

Diluted earnings per share from continuing operations ~~decreased $451 million, or 52%, to $418 million~~was $3.29 per share for the first quarter of 2020 compared to $2.70 per share for the ~~first nine months of 2016.~~prior year period.

Cash flow provided by operating activities was ~~$289~~$338 million for the first ~~nine~~three months of ~~2017, a decrease~~2020, an increase of ~~$863~~$264 million from ~~$1,152 million in~~ the prior year ~~period.~~period, primarily reflecting strong operational improvement and near-term actions taken to improve working capital in an effort to proactively manage liquidity due to uncertainties surrounding COVID-19 and its impact on the Company. The ~~decrease was driven primarily by cash tax payments associated with the Divested Business and $199~~prior year period included approximately $85 million of ~~restructuring~~net cash payments ~~partially offset by operational improvement.~~related to legacy litigation.

We focus on four key ~~non-GAAP~~ metrics not presented in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) that we communicate to shareholders: organic revenue growth, adjusted operating margin, adjusted diluted earnings per share, and free cash flow. These non-GAAP metrics should be viewed in addition to, not instead of, our unaudited Condensed Consolidated Financial Statements and Notes ~~thereto.~~thereto (our “Financial Statements”). The following is our measure of performance against these four metrics from continuing operations for the ~~third~~first quarter of ~~2017:~~2020:

Organic revenue growth, a non-GAAP measure defined under the caption “Review of Consolidated Results — Organic Revenue Growth,” was 2%5% for the ~~third~~first quarter of ~~2017, compared to 4% organic growth in the prior year period.~~2020. Organic revenue growth was ~~3% for~~driven by strong new business generation in Reinsurance Solutions and strong management of the ~~first nine months of 2017, compared to 3%~~renewal book globally in ~~the prior year period.~~Health Solutions and Commercial Risk Solutions.

Adjusted operating margin, a non-GAAP measure defined under the caption “Review of Consolidated Results — Adjusted Operating Margin,” was ~~20.3%~~35.7% for the ~~third~~first quarter of ~~2017~~2020 compared to ~~18.6% for the prior year period. For the first nine months of 2017, adjusted operating margin was 21.7% as compared to 20.0% for~~33.7% in the prior year period. The ~~increases~~increase in adjusted operating margin primarily ~~reflect restructuring savings,~~reflects strong organic revenue growth of 5%, increased operating leverage across the portfolio, and ~~underlying operational improvement, partially offset by expenses related to reinvestment.~~the preemptive reduction and deferral of certain discretionary expenses.

Adjusted diluted earnings per share from continuing operations, a non-GAAP measure defined under the caption “Review of Consolidated Results — Adjusted Diluted Earnings per Share,” was ~~$1.29~~$3.68 per share for the ~~third~~first quarter of ~~2017 and $4.19 in the first nine months of 2017,~~2020 compared to ~~$1.09 per share and $3.59~~$3.31 per share for the ~~respective~~ prior year ~~periods.~~period.

Free cash flow, a non-GAAP measure defined under the caption “Review of Consolidated Results — Free Cash Flow,” ~~decreased~~increased in the first ~~nine~~three months of ~~2017~~2020 by ~~$881~~$262 million, or ~~84%~~1,541%, from the prior year period, to ~~$164~~$279 million, ~~driven by a decrease of $863 million~~reflecting an increase in cash flow from operations, ~~and an~~partially offset by a $2 million increase ~~of $18 million~~ in capital ~~expenditures,~~expenditures.

IRELAND REORGANIZATION

On April 1, 2020, a scheme of arrangement under English law was completed pursuant to which the Class A ordinary shares of Aon plc, a public limited company incorporated under the laws of England and Wales and the publicly traded parent company of the Aon group (“Aon UK”), were cancelled and the holders thereof received, on a one-for-one basis, Class A ordinary shares of Aon plc, an Irish public limited company formerly known as Aon Limited (“Aon Ireland”), as described in the proxy statement filed with the U.S. Securities and Exchange Commission (“SEC”) on December 20, 2019. Aon Ireland is a tax resident of Ireland. References in this report to “Aon,” the “Company,” “we,” “us,” or “our” for time periods prior to April 1, 2020 refer to Aon UK. References in the Financial Statements to “Aon,” the “Company,” “we,” “us,” or “our” for time periods on or after April 1, 2020, refer to Aon Ireland.

BUSINESS COMBINATION AGREEMENT

On March 9, 2020, Aon and WTW, entered into a Business Combination Agreement with respect to a combination of the parties (the “Combination”). At the effective date of the Combination, WTW shareholders will be entitled to receive 1.08 newly issued Class A ordinary shares of Aon Ireland in exchange for each ordinary share of WTW held by such holders. The Combination is expected to be completed in the first half of 2021 and is subject to Irish Takeover Rules. The Business Combination Agreement contains certain operating covenants relating to the conduct of business of both parties in the interim period until the transaction is completed. These covenants require both parties to operate their respective businesses in all material respects in the ordinary course of business consistent with past practice. In addition, these covenants restrict each party from engaging in certain actions unless a party obtains the prior written consent of the other party. These actions relate to, among other things, authorizing or paying dividends above a specified rate; issuing or authorizing for issuance additional securities; salary, benefits or other compensation and employment-related matters; capital management, debt and liquidity matters; engaging in mergers, acquisitions and dispositions; entering into or materially modifying material agreements; entering into material litigation-related settlements; and making other corporate, tax and accounting changes.

RECENT DEVELOPMENTS

The recent outbreak of the coronavirus, COVID-19, which has been declared by the World Health Organization to be a pandemic, has spread across the globe, resulting in restrictions on travel and quarantine policies being put in place by businesses and governments and is impacting worldwide economic activity. COVID-19 and its resulting impact may adversely affect our business and we are closely monitoring the situation and our business, liquidity, and capital planning initiatives, in compliance with local government guidelines. At this time, we are fully operational and have deployed business continuity protocols to facilitate remote working capabilities to ensure the health and safety of our colleagues and to comply with public health and travel guidelines and restrictions. We have deployed enhanced information technology (IT) security protocols, including ~~investments~~an upgraded virtual private network (VPN), and required IT equipment to our outsourcing vendors in order to limit operational disruption. Our Global Emergency Operations Center is actively tracking the situation and providing communications and resources to our ~~operating model.~~global colleagues. Eventual reoccupation of our offices is expected to happen in phases as local mandates are lifted and once protocols are in place to ensure a safe work environment.

As the situation is rapidly evolving, and the scale and duration of disruption cannot be predicted, it is not possible to quantify or estimate the full impact that COVID-19 will have on our business. We are focused on navigating these challenges and potential future impacts to our business presented by COVID-19 through preserving our liquidity and managing our cash flow through taking proactive action to enhance our ability to meet our short-term liquidity needs and support a commitment to no layoffs of our colleagues due to COVID-19. Such actions include, but are not limited to, reducing our discretionary spending, extending days payable outstanding, revisiting our investment strategies, suspending our share buyback program until further notice, and reducing payroll costs, including through delayed hiring of new colleagues, as well as temporarily reducing salaries for existing colleagues.

While the ultimate public health and economic impact of the COVID-19 pandemic is highly uncertain, we expect that our business operations and results of operations, including our net revenues, earnings, and cash flows, will be adversely impacted, depending on the duration and severity of the downturn. Our revenue can be generalized into two categories, including core and more discretionary arrangements. Core revenues tend to be highly-recurring and non-discretionary, where the services are typically regulated, required, or necessary costs of managing the risk of doing business. More discretionary revenues tend to include project-related services, where in an economic downturn, we expect to see more immediate impacts from decreases in revenue, and have already started to see a modest impact in the first quarter of 2020. In a severe downturn, we expect that certain services within our

core business may be negatively impacted as well. The impact of the pandemic on our business operations and results of operations for the first quarter of 2020 are further described in the “Review of Consolidated Results” and “Liquidity and Financial Conditions” contained in Part I, Item 2 of this report. Refer to Part II, Item 1A of this report for a further discussion of the risks associated with COVID-19.

REVIEW OF CONSOLIDATED RESULTS

Summary of Results

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


	Three Months Ended						Nine Months Ended						Three Months Ended March 31,
(millions)	September 30, 2017			September 30, 2016			September 30, 2017			September 30, 2016
													2020			2019
Revenue
Total revenue	$	2,340		$	2,201		$	7,089		$	6,759		$	3,219		$	3,143
Expenses
Compensation and benefits	1,419			1,300			4,337			4,041			1,522			1,584
Information technology	109			99			295			281			111			117
Premises	89			86			259			257			73			87
Depreciation of fixed assets	40			39			148			118			41			40
Amortization and impairment of intangible assets	101			42			604			117
Other general expenses	317			267			956			770
Amortization of intangible assets													97			97
Other general expense													342			346
Total operating expenses	2,075			1,833			6,599			5,584			2,186			2,271
Operating income	265			368			490			1,175			1,033			872
Interest income	10			1			20			6			2			2
Interest expense	(70		)	(70		)	(211		)	(212		)	(83		)	(72		)
Other income (expense)	(5		)	10			(20		)	27			29			—
Income from continuing operations before income taxes	200			309			279			996			981			802
Income tax expense (benefit)	4			25			(139		)	127
Income tax expense													189			126
Net income from continuing operations	196			284			418			869			792			676
Income from discontinued operations, net of tax	(4		)	42			857			102
Net income (loss) from discontinued operations													(1		)	—
Net income	192			326			1,275			971			791			676
Less: Net income attributable to noncontrolling interests	7			7			30			27			19			17
Net income attributable to Aon shareholders	$	185		$	319		$	1,245		$	944		$	772		$	659
Diluted net income per share attributable to Aon shareholders
Continuing operations													$	3.29		$	2.70
Discontinued operations													—			—
Net income													$	3.29		$	2.70
Weighted average ordinary shares outstanding - diluted													234.5			243.7

Revenue

Total revenue increased by ~~6%,~~$76 million, or ~~$139 million,~~2%, in the ~~third~~first quarter of ~~2017~~2020 compared to the ~~third~~first quarter of ~~2016.~~2019. This ~~change~~increase reflects ~~a 3% increase related to acquisitions, net of divestitures, 2%~~ organic revenue growth ~~and a 1% favorable impact from foreign currency exchange rates. For the first nine months~~ of ~~2017, total revenue increased~~ 5%, ~~or $330 million, compared to the prior year period. This change reflects 3% organic growth and a 3% increase related to acquisitions, net of divestitures,~~ partially offset by a 1%2% unfavorable impact from foreign currency ~~exchange rates.~~translation and a 1% unfavorable impact related to divestitures, net of acquisitions.

Commercial Risk Solutions ~~organic~~ revenue increased $28 million, or 3%, to $1,146 million in the first quarter of 2020, compared to $1,118 million in the first quarter of 2019. Organic revenue growth was ~~(1)%~~4% in the ~~third~~first quarter of ~~2017~~2020, driven by a~~modest decline~~growth across ~~the Americas, particularly~~every major geography, highlighted by double-digit growth in ~~U.S. retail~~Canada and Latin America, ~~due~~primarily driven by strong retention and management of the renewal book portfolio. On average globally, exposures and pricing were both modestly positive, resulting in a modestly positive market impact overall.

Reinsurance Solutions revenue increased $60 million, or 8%, to ~~certain unfavorable timing,~~$848 million in the first quarter of 2020, compared to $788 million in the first quarter of 2019. Organic revenue growth was 9% in the first quarter of 2020, driven by strong net new business generation globally in treaty and solid growth in facultative placements, partially offset by a modest decline in capital markets

transactions. Results in the quarter include a modest positive impact from the timing of certain revenue, which will be spread evenly for the balance of 2020. In addition, market impact was modestly positive on results in the quarter.

Retirement Solutions revenue decreased $23 million, or 5%, to $397 million in the first quarter of 2020, compared to $420 million in the first quarter of 2019. Organic revenue growth was flat in the first quarter of 2020, driven by driven by solid growth in Investments, including double-digit growth in delegated investment management, as well as modest growth in Human Capital, primarily for assessment services. Results in the quarter were offset by a decline in core retirement, reflecting a decrease in billable hours and discretionary project-related work, primarily as a result of COVID-19.

Health Solutions revenue increased $16 million, or 3%, to $502 million in the first quarter of 2020, compared to $486 million in the first quarter of 2019. Organic revenue growth was 5% in the first quarter of 2020, driven by solid growth across every major geography in health and benefits brokerage, highlighted by particular strength in Latin America, Asia, and the EMEA ~~and Pacific regions.~~region. Results in the quarter also include growth in the active exchange business.

Data & Analytic Services revenue decreased $5 million, or 1%, to $331 million in the first quarter of 2020 compared to $336 million in the first quarter of 2019. Organic revenue growth was 1% in the first ~~nine months of 2017 compared to the prior year period driven by solid growth across the U.S., EMEA, and Pacific regions, partially offset by a decline in Latin America.~~

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

~~Retirement Solutions~~ organic revenue growth was 5% in the third quarter of 2017 compared to the third quarter of 2016 driven by strong growth in investment consulting, primarily for delegated investment management, as well as growth in our talent practice, primarily for compensation surveys and benchmarking services. Organic revenue growth was 3% in the first nine months of 2017 compared to the prior year period2020, driven by growth ~~in investment consulting, primarily for delegated investment management.~~

~~Health Solutions~~ ~~organic revenue growth was 2% in~~globally across the ~~third quarter of 2017 compared to the third quarter of 2016 driven by solid growth in health & benefits brokerage, particularly in the U.S. and Latin America, partially offset by a decline in project~~

related work in the healthcare exchange business. Organic revenue growth was 7% for the first nine months of 2017 compared to the prior year period driven by solid growth globally in health & benefits brokerage.

~~Data & Analytic Services~~ ~~organic revenue growth was 3% in the third quarter and 4% for first nine months of 2017 compared to the respective prior year periods driven by strong growth in the Affinity~~affinity business, with particular strength in the U.S. across both business and consumer solutions. Results in the quarter also reflect pressure in certain, more discretionary parts of the business, primarily as a result of COVID-19.

Compensation and Benefits

Compensation and benefits ~~increased $119~~decreased $62 million, or 9%4%, in the ~~third~~first quarter of ~~2017~~2020 compared to the ~~third~~first quarter of ~~2016.~~2019. This ~~increase~~decrease was primarily driven by ~~$52~~a $26 million ~~of restructuring costs, a $37 million increase in expenses from businesses acquired, net of divestitures, a $14 million unfavorable~~favorable impact from foreign currency translation, $2a $24 million ~~of transaction related costs associated with recent acquisitions,~~decrease in restructuring charges, and expense discipline, partially offset by an increase in expense associated with 2%5% organic revenue growth, partially offset by $32 million of savings related to restructuring and other operational improvement initiatives. For the first nine months of 2017, compensation and benefits increased $296 million, or 7%, compared to the first nine months of 2016. The increase was primarily driven by $257 million of restructuring costs, a $110 million increase in expenses related to acquisitions, net of divestitures, and an increase in expense associated with 3% organic revenue growth, partially offset by $62 million of expense related to certain non-cash pension settlements in the prior year period, $62 million of savings related to restructuring and other operational improvement initiatives, and a $53 million favorable impact from foreign currency translation.growth.

Information Technology

Information technology, which represents costs associated with supporting and maintaining our infrastructure, ~~increased $10~~decreased $6 million, or ~~10%~~5%, in the ~~third~~first quarter of ~~2017~~2020 compared to the ~~third~~first quarter of ~~2016.~~2019. This ~~increase~~decrease was primarily driven by ~~$12~~an $11 million ofdecrease in restructuring ~~costs, as well as investments in growth,~~charges, partially offset by ~~$13 million of savings related to restructuring~~an increase in investments supporting growth initiatives and other operational improvement initiatives. For the first nine months of 2017, information technology increased $14 million, or 5%, compared to the prior year period. This increase was primarily driven by $22 million of restructuring charges and investments in growth, partially offset by $29 million of savings related to restructuring and other operational improvement initiatives.Aon Business Services.

Premises

Premises, which represents the cost of occupying offices in various locations throughout the world, ~~increased $3~~decreased $14 million, or 3%16%, in the ~~third~~first quarter of 2017 compared to the third quarter of 2016. This increase was primarily driven by $4 million of restructuring costs, partially offset by $1 million of savings related to restructuring and other operational improvement initiatives. For the first nine months of 2017, premises increased $2 million, or 1%,2020 compared to the first ~~nine months~~quarter of ~~2016.~~2019. This ~~increase~~decrease was primarily driven by a $9 million ~~increase~~decrease in ~~expenses related to acquisitions, net of divestitures and $8 million of~~ restructuring ~~costs, partially offset by $2 million of savings related to restructuring and other operational improvement initiatives~~charges and a ~~decrease in expense~~reduction of costs as wethe Company continues to optimize ~~our~~its global real estate footprint.

Depreciation of Fixed Assets

Depreciation of fixed assets primarily relates to software, leasehold improvements, furniture, fixtures and equipment, computer equipment, buildings, and automobiles. Depreciation of fixed assets increased $1 million, or 3%, in the ~~third~~first quarter of 2017 compared to the third quarter of 2016. This increase was primarily driven by $2 million of restructuring costs. For the first nine months of 2017, depreciation of fixed assets increased $30 million, or 25%,2020 compared to the first ~~nine months~~quarter of ~~2016. This increase was primarily driven by $26 million of restructuring costs and a $12 million increase in expenses related to acquisitions, net of divestitures.~~2019.

Amortization and Impairment of Intangibles Assets

Amortization and impairment of ~~intangibles~~intangible assets primarily relates to finite-lived tradenames and customer-related, contract-based, and technology assets. Amortization and impairment of intangibles ~~increased $59~~was $97 million in the first quarter of 2020, similar to the first quarter of 2019.

Other General Expense

Other general expense in the first quarter of 2020 decreased $4 million, or 140%, in the third quarter of 2017 compared to the third quarter of 2016 due to $54 million of accelerated amortization related to tradenames. For the first nine months of 2017, amortization and impairment of intangibles increased $487 million, or 416%1%, compared to the first nine months of 2016 due to a $380 million non-cash impairment charge to the tradenames associated with the sale of the Divested Business and $89 million of accelerated amortization related to tradenames.

~~Other General Expenses~~

~~Other general expenses in the third~~ quarter of ~~2017 increased $50 million, or 19%, compared to the third quarter of 2016. This increase was~~2019 due primarily to ~~$32~~a $47 million decrease in restructuring charges, a $9 million favorable impact from foreign currency translation, and the preemptive reduction and deferral of certain discretionary expenses, partially offset by $18 million of ~~restructuring~~transaction costs ~~a $17 million increase in operating expenses~~ related to ~~acquisitions, net of divestitures, $8~~the Combination, $7 million of costs related to ~~regulatory and compliance matters, and $8 million~~move of ~~transaction related costs associated~~the jurisdiction for the firm’s parent company to recent acquisitions, partially offset by $9 million of savings from restructuring and other operational improvement initiatives. For the first nine months of 2017, other general expenses increased $186 million, or 24%, compared to the prior year period. This increase was primarily driven by $88 million of restructuring costs, a $49 million increase in operating expenses related to acquisitions, net of divestitures, $42 million of costs related to regulatory and compliance matters,Ireland, and an increase in expense associated with 3%5% organic revenue ~~growth, partially offset by $16 million of savings related to restructuring and other operational improvement initiatives and a $13 million favorable impact from foreign currency translation.~~growth.

Interest Income

Interest income represents income earned on operating cash balances and other income-producing investments. It does not include interest earned on funds held on behalf of clients. During the ~~third~~first quarter of ~~2017, Interest~~2020, interest income was ~~$10~~$2 million, ~~compared~~similar to ~~$1 million during~~ the prior year period. For the first nine months of 2017, Interest income was $20 million, compared to $6 million during the prior year period. The increase in both periods reflects additional income earned on the proceeds from the sale of the Divested Business.

Interest Expense

Interest expense, which represents the cost of our debt obligations, was ~~$70 million during the third quarter of 2017, similar to $70~~$83 million for the ~~prior year period. For~~first quarter of 2020, an increase of $11 million, or 15%, from the first ~~nine months~~quarter of ~~2017, Interest expense~~2019. The increase was ~~$211 million, a decrease from $212 million for the prior year period.~~driven primarily by higher outstanding term debt and an increase in commercial paper borrowings.

Other Income (Expense)

~~Other expense~~Total other income was $5$29 million for the ~~third~~first quarter of ~~2017,~~2020, compared to other income of ~~$10~~$0 million for the ~~third~~first quarter of ~~2016.~~2019. Other ~~expense~~income for the ~~third~~first quarter of ~~2017~~2020 primarily includes ~~$20~~$42 million of gains due to the favorable impact of exchange rates on the remeasurement of assets and liabilities in non-functional currencies, a $25 million gain on the sale of certain businesses, and $4 million of pension and other postretirement income, partially offset by $44 million of losses on financial instruments used to economically hedge gains and losses from changes in foreign exchange rates. Other income for the first quarter of 2019 primarily includes $11 million of losses due to the unfavorable impact of exchange rates on the remeasurement of assets and liabilities in non-functional currencies, ~~partially~~ offset by ~~$16~~a $5 million ~~of gains on financial instruments. Other income of $10 million in the third quarter of 2016 primarily includes gains on certain long term investments.~~

Other expense was $20 million for the first nine months of 2017, compared to other income of $27 million for the prior year period. Other expense for the first nine months of 2017 primarily includes $32 million of losses due to the unfavorable impact of exchange rates on the remeasurement of assets and liabilities in non-functional currencies, excluding hedging gains, partially offset by $6 million of gains on certain financial instruments. Other income of $27 million in the first nine months of 2016 primarily included $41 million of net gainsgain on the sale of certain businesses, ~~partially offset by a $14~~$4 million ~~unfavorable impact~~ of pension and other postretirement income, $1 million of equity earnings, and $1 million of gains on financial instruments used to economically hedge gains and losses from changes in foreign exchange ~~rates on the remeasurement of assets and liabilities in non-functional currencies, excluding hedging losses.~~rates.

Income ~~From~~from Continuing Operations before Income Taxes

Due to the factors discussed above, income from continuing operations before income taxes for the ~~third~~first quarter of ~~2017~~2020 was ~~$200~~$981 million, a ~~35% decrease~~22% increase from ~~$309 million in the third quarter~~income from continuing operations before income taxes of ~~2016, and $279 million for the first nine months of 2017, a 72% decrease from $996~~$802 million in the first ~~nine months~~quarter of ~~2016.~~2019.

Income Taxes ~~From~~from Continuing Operations

The effective tax ~~rate~~rates on net income from continuing operations ~~was 2.0%~~were 19.3% and ~~8.1%~~15.7% for the ~~third quarters~~first quarter of ~~2017~~2020 and ~~2016,~~2019, respectively. ~~The effective tax rate on net income from continuing operations was (49.8)% and 12.8% for~~

For the ~~nine~~three months ended ~~September 30, 2017 and 2016, respectively. For~~March 31, 2020, the ~~nine months ended September 30, 2017, the Company reported a tax benefit of $139 million on pretax income of $279 million, which resulted in an effective~~ tax rate of (49.8)%. The primary components of this tax amount were the non-cash tax benefit from the tradename impairment associated with the Divested Business and the impact of share-based payments from adoption of the new share-based compensation guidance.

~~Income from Discontinued Operations, Net of Tax~~

On February 9, 2017, the Company entered into the Purchase Agreement with Tempo Acquisition, LLC to sell the Divested Business. The Company has retrospectively classified the results of the Divested Business as discontinued operations in the Company’s Condensed Consolidated Statements of Income for all periods presented. Income from discontinued operations, net of tax, decreased $46 million in the third quarter of 2017 as compared to the prior year period. The decrease was primarily driven by ~~run off expenses associated with~~ the ~~Divested Business.~~geographical distribution of income and certain discrete items including the favorable impact of share-based payments.

For the three months ended March 31, 2019, the tax rate was primarily driven by the geographical distribution of income and certain discrete items including the favorable impact of share-based payments.

Net Income from Discontinued Operations

Net loss from discontinued operations ~~net of tax, increased $755~~was $1 million in the ~~first nine~~three months ~~of 2017 as~~ended March 31, 2020 compared to no impact on the prior year period. ~~The increase is primarily driven by a $803 million gain on sale of the Divested Business.~~

Net Income Attributable to Aon Shareholders

Net income attributable to Aon shareholders for the ~~three months ended September 30, 2017 decreased~~first quarter of 2020 increased to ~~$185~~$772 million, or ~~$0.72~~$3.29 per diluted share, from ~~$319~~$659 million, or ~~$1.18~~$2.70 per diluted share, in the prior year period. Net income attributable to Aon shareholders for the first nine months of 2017 increased to $1,245 million, or $4.74 per diluted share, from $944 million, or $3.48 per diluted share, in the prior year period.

Non-GAAP Metrics

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

Organic Revenue Growth

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

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

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

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


	Nine Months Ended																Three Months Ended March 31,
	September 30, 2017			September 30, 2016			% Change		Less: Currency Impact ⁽¹⁾		Less: Fiduciary Investment Income ⁽²⁾		Less: Acquisitions, Divestitures & Other		Organic Revenue Growth ⁽³⁾		2020			2019			% Change		Less: Currency Impact ⁽¹⁾		Less: Fiduciary Investment Income ⁽²⁾		Less: Acquisitions, Divestitures & Other		Organic Revenue Growth ⁽³⁾
Revenue
Commercial Risk Solutions	$	2,943		$	2,835		4	%	(1	)%	—	%	4	%	1	%	$	1,146		$	1,118		3	%	(2	)%	—	%	1	%	4	%
Reinsurance Solutions	1,070			1,032			4		(1	)	—		—		5		848			788			8		(1	)	—		—		9
Retirement Solutions	1,266			1,266			—		(2	)	—		(1	)	3		397			420			(5	)	(1	)	—		(4	)	—
Health Solutions	977			838			17		(1	)	—		11		7		502			486			3		(2	)	—		—		5
Data & Analytic Services	842			794			6		—		—		2		4		331			336			(1	)	(2	)	—		—		1
Elimination	(9		)	(6		)	N/A		N/A		N/A		N/A		N/A		(5		)	(5		)	N/A		N/A		N/A		N/A		N/A
Total revenue	$	7,089		$	6,759		5	%	(1	)%	—	%	3	%	3	%	$	3,219		$	3,143		2	%	(2	)%	—	%	(1	)%	5	%


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


(2)	Fiduciary investment income for the three months ended ~~September 30, 2017~~March 31, 2020 and ~~2016,~~2019, respectively, was ~~$10~~$15 million and ~~$6 million. Fiduciary Investment Income for the nine months ended September 30, 2017 and 2016, respectively, was $23 million and $16~~$19 million.


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

Adjusted Operating Margin

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

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


	Three Months Ended						Nine Months Ended						Three Months Ended March 31,
	September 30, 2017			September 30, 2016			September 30, 2017			September 30, 2016			2020			2019
Revenue from continuing operations	$	2,340		$	2,201		$	7,089		$	6,759		$	3,219		$	3,143

Operating income from continuing operations - as reported	$	265		$	368		$	490		$	1,175		$	1,033		$	872
Amortization and impairment of intangible assets	101			42			604			117			97			97
Restructuring	102			—			401			—			—			91
Regulatory and compliance matters	8			—			42			—
Pension settlement	—			—			—			62
Operating income income from continuing operations - as adjusted	$	476		$	410		$	1,537		$	1,354
Transaction costs ⁽¹⁾													18			—
Operating income from continuing operations - as adjusted													$	1,148		$	1,060

Operating margin from continuing operations - as reported	11.3		%	16.7		%	6.9		%	17.4		%	32.1		%	27.7		%
Operating margin from continuing operations - as adjusted	20.3		%	18.6		%	21.7		%	20.0		%	35.7		%	33.7		%


(1)	Certain transaction costs associated with the Combination will be incurred prior to the expected completion of the Combination in the first half of 2021. These costs may include advisory, legal, accounting, valuation, and other professional or consulting fees required to complete the Combination.

Adjusted Diluted Earnings per Share

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

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


	Three Months Ended September 30, 2017									Three Months Ended March 31, 2020
(millions, except per share data)	U.S. GAAP			Adjustments			As Adjusted
															Non-GAAP
										U.S. GAAP			Adjustments		Adjusted
Operating income from continuing operations	$	265		$	211		$	476		$	1,033		$	115	$	1,148
Interest income	10			—			10			2			—		2
Interest expense	(70		)	—			(70		)	(83		)	—		(83		)
Other income (expense)	(5		)	—			(5		)	29			—		29
Income before income taxes from continuing operations	200			211			411
Income taxes ⁽¹⁾	4			68			72
Income from continuing operations before income taxes										981			115		1,096
Income tax expense ⁽¹⁾										189			23		212
Net income from continuing operations	196			143			339			792			92		884
Income from discontinued operations, net of tax ⁽²⁾	(4		)	(6		)	(10		)
Net income (loss) from discontinued operations										(1		)	—		(1		)
Net income	192			137			329			791			92		883
Less: Net income attributable to noncontrolling interests	7			—			7			19			—		19
Net income attributable to Aon shareholders	$	185		$	137		$	322		$	772		$	92	$	864

Diluted net income (loss) per share attributable to Aon shareholders
Diluted net income per share attributable to Aon shareholders
Continuing operations	$	0.73		0.56			$	1.29		$	3.29		$	0.39	$	3.68
Discontinued operations	(0.01		)	(0.03		)	(0.04		)	—			—		—
Net income	$	0.72		$	0.53		$	1.25		$	3.29		$	0.39	$	3.68

Weighted average ordinary shares outstanding - diluted	257.3			—			257.3			234.5			—		234.5
Effective tax rates ⁽¹⁾
Continuing operations										19.3		%			19.3		%
Discontinued operations										30.7		%			30.7		%

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

Diluted net income per share attributable to Aon shareholders

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

Weighted average ordinary shares outstanding - diluted 269.6
—
269.6

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

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

Weighted average ordinary shares outstanding - diluted 262.9
—
262.9


	Nine Months Ended September 30, 2016								Three Months Ended March 31, 2019
(millions, except per share data)	U.S. GAAP			Adjustments		As Adjusted
														Non-GAAP
									U.S. GAAP			Adjustments		Adjusted
Operating income from continuing operations	$	1,175		$	179	$	1,354		$	872		$	188	$	1,060
Interest income	6			—		6			2			—		2
Interest expense	(212		)	—		(212		)	(72		)	—		(72		)
Other income (expense)	27			—		27			—			—		—
Income before income taxes from continuing operations	996			179		1,175
Income taxes ⁽¹⁾	127			49		176
Income from continuing operations before income taxes									802			188		990
Income tax expense ⁽¹⁾									126			41		167
Net income from continuing operations	869			130		999			676			147		823
Income from discontinued operations, net of tax ⁽²⁾	102			69		171
Net income (loss) from discontinued operations									—			—		—
Net income	971			199		1,170			676			147		823
Less: Net income attributable to noncontrolling interests	27			—		27			17			—		17
Net income attributable to Aon shareholders	$	944		$	199	$	1,143		$	659		$	147	$	806

Diluted net income per share attributable to Aon shareholders
Continuing operations	$	3.11		0.48		$	3.59		$	2.70		$	0.61	$	3.31
Discontinued operations	0.37			0.26		0.63			—			—		—
Net income	$	3.48		$	0.74	$	4.22		$	2.70		$	0.61	$	3.31

Weighted average ordinary shares outstanding - diluted	271.0			—		271.0			243.7			—		243.7
Effective tax rates ⁽¹⁾
Continuing operations									15.7		%			16.9		%
Discontinued operations									—		%			—		%

(1)

~~The effective tax rates used in the U.S. GAAP financial statements for continuing operations were 2.0% and (49.8)%, respectively, for the three and nine months ended September 30, 2017.~~ Adjusted items are generally taxed at the estimated annual effective tax rate, except for the applicable tax impact associated with estimated restructuring plan expenses, accelerated tradename amortization, impairment charges ~~regulatory~~ and ~~compliance provisions, and non-cash pension settlement charges anticipated in the forth quarter of 2017,~~certain transaction costs, which are adjusted at the related jurisdictional rate. ~~After adjusting to exclude the applicable~~In addition, tax impact, the adjusted effective tax rates for continuing operations were 17.5% and 14.6%, respectively, for the three and nine months ended September 30, 2017. The effective tax rates used in the U.S. GAAP financial statements for continuing operations were 8.1% and 12.8%, respectively, for the three and nine months ended 2016. Adjusted items are generally taxed at the estimated annual effective tax rate, except for the applicable tax impact associated with non-cash pension charges settled in the second quarter of 2016, which are adjusted at the related jurisdictional rate. After adjusting to exclude the applicable tax impact, the adjusted effective tax rates for continuing operations were 14.2% and 15.0%, respectively, for the three and nine months ended 2016.

~~(2)~~

~~Adjusted income from discontinued operations, net of tax,~~expense excludes the ~~gain on sale~~tax impacts of payment of certain legacy litigation and ~~intangible asset amortization on discontinued operations~~enactment date impacts of ~~$11 million~~the Tax Cuts and ~~$0 million, respectively, for the three months ended September 30, 2017 and $1,983 million and $11 million for the nine months ended September 30,~~Jobs Act of 2017. The effective tax rates used in the U.S. GAAP financial statements for discontinued operation were 35.1% and 21.8%, respectively, for the three months and nine months ended September 30, 2017. After adjusting to exclude the applicable tax impact associated with the gain on sale and intangible asset amortization, the adjusted effective tax rates for discontinued operations were 35.2% and 24.2%, respectively, for the three months and nine months ended September 30, 2017. Adjusted income from discontinued operations, net of tax, excludes intangible asset amortization on discontinued operations of $30 million and $90 million, respectively, for the three months and nine months ended September 30, 2016. The effective tax rates used in the U.S. GAAP financial statements for discontinued operation were 37.3% and 37.4% for the three and nine months ended 2016, respectively. After adjusting to exclude the applicable tax impact associated with amortization, the adjusted effective tax rates for discontinued operations were 32.8% and 32.4% for the three and nine months ended 2016, respectively.

Free Cash Flow

We use free cash flow, defined as cash flow provided by operations less capital expenditures, as a non-GAAP measure of our core operating performance and cash-generating capabilities of our business operations. This supplemental information related to free cash flow represents a measure not in accordance with U.S. GAAP and should be viewed in addition to, not instead of, our ~~Condensed Consolidated~~ Financial ~~Statements and Notes thereto.~~Statements. The use of this non-GAAP measure does not imply or represent the residual cash flow for discretionary expenditures. A reconciliation of this non-GAAP measure to the reported cash provided by ~~continuing~~ operating activities is as follows (in ~~millions, except percentages)~~millions):

Nine Months Ended
September 30, 2017 September 30, 2016
Cash Provided by Continuing Operating Activities $ 289
$ 1,152
Capital Expenditures Used for Continuing Operations (125 ) (107 )
Free Cash Flow Provided By Continuing Operations
$ 164
$ 1,045



	Three Months Ended March 31,
	2020			2019
Cash provided by operating activities	$	338		$	74
Capital expenditures used for operations	(59		)	(57		)
Free cash flow provided by operations	$	279		$	17

Impact of Foreign Exchange Rate Fluctuations

Because we conduct business in ~~more than 100~~over 120 countries and sovereignties, foreign exchange rate fluctuations may have a significant impact on our business. Foreign exchange rate movements may be significant and may distort true period-to-period comparisons of changes in revenue or pretax income. Therefore, to give financial statement users meaningful information about our operations, we have provided an illustration of the impact of foreign currency exchange rates on our financial results. The methodology used to calculate this impact isolates the impact of the change in currencies between periods by translating the prior year quarter’s revenue, expenses, and net income using the current quarter’s foreign exchange rates.

Translating prior year quarter results at current quarter foreign exchange rates, currency fluctuations had ~~$0.01 and $0.06 impacts, respectively,~~an unfavorable impact of $0.03 on net income per diluted share during the three ~~and nine~~ months ended ~~September 30, 2017.~~March 31, 2020. Currency fluctuations had ~~$0.03 and $(0.03) impacts, respectively,~~an unfavorable

impact of $0.12, on net income per diluted share during the three ~~and nine~~ months ended ~~September 30, 2016,~~March 31, 2019, when ~~2015~~2018 results were translated at ~~2016~~2019 rates.

Translating prior year quarter results at current quarter foreign exchange rates, currency fluctuations had ~~$0.01 and $0.02 impacts, respectively,~~an unfavorable impact of $0.03 on adjusted net income per diluted share during the three ~~and nine~~ months ended ~~September 30, 2017.~~March 31, 2020. Currency fluctuations had ~~$0.02 and $(0.07) impacts, respectively,~~an unfavorable impact of $0.13 on adjusted net income per diluted share during the three ~~and nine~~ months ended ~~September 30, 2016,~~March 31, 2019, when ~~2015~~2018 results were translated at ~~2016~~2019 rates. These translations are performed for comparative and illustrative purposes only and do not impact the accounting policies or practices for amounts included in ~~the Condensed Consolidated~~our Financial Statements.

~~Restructuring Plan~~

In 2017, we initiated a global restructuring plan (the “Restructuring Plan”) in connection with the sale of the Divested Business. The Restructuring Plan is intended to streamline operations across the organization and deliver greater efficiency, insight and connectivity. We expect these restructuring activities and related expenses to affect continuing operations through 2019, including an estimated 2,400 to 2,850 role eliminations. The Restructuring Plan is expected to result in cumulative costs of approximately $750 million through the end of the plan, consisting of approximately $303 million in employee termination costs, $146 million in technology rationalization costs, $80 million in real estate consolidation costs, $40 million in asset impairments and $181 million in other costs including certain separation costs associated with the sale of the Divested Business. Included in the estimated $750 million is $50 million of estimated non-cash charges related to asset impairments and lease consolidations. We estimate that our annualized savings from the Restructuring Plan will be approximately $400 million by the end of 2019.

From the inception of the Restructuring Plan through September 30, 2017, the Company has eliminated 2,125 positions and a total of $401 million of restructuring and related separation charges have been incurred. These charges are included in Compensation and benefits, Information technology, Premises, Depreciation of fixed assets, and Other general expenses in the accompanying Condensed Consolidated Statements of Income.

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

~~(1)~~

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

~~(2)~~


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

~~As of September 30, 2017, our liabilities for the Restructuring Plan were as follows (in millions):~~

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

~~Competition and Markets Authority~~

The U.K.’s competition regulator, the Competition and Markets Authority (the “CMA”), is conducting a market investigation into the supply and acquisition of investment consulting and fiduciary management services, including those offered by Aon and its competitors in the U.K. The CMA has indicated that it will assess whether any feature or combination of features in the target market prevents, restricts, or distorts competition. The CMA can impose a wide range of remedies to address uncompetitive markets. The investigation is in its very early stages. Thus, we are not presently in a position to estimate the impact, if any, of this investigation on Aon’s UK investment business.

LIQUIDITY AND FINANCIAL CONDITION

Liquidity

Executive Summary

We believe that our balance sheet and strong cash flow provide us with adequate liquidity. Our primary sources of liquidity are cash ~~flow from~~flows provided by operations, available cash reserves, and debt capacity available under our credit ~~facility.~~facilities. Our primary uses of liquidity are operating expenses, restructuring activities, capital expenditures, acquisitions, share repurchases, pension obligations, and shareholder dividends. We believe that cash flows from operations, available credit facilities and the capital markets will be sufficient to meet our liquidity needs, including principal and interest payments on debt obligations, capital expenditures, pension contributions, and anticipated working capital requirements, for the foreseeable future.

As a result of the COVID-19 pandemic, we have taken various proactive steps and continue to evaluate opportunities that will increase our liquidity and strengthen our financial position. Such actions include, but are not limited to, reducing our discretionary spending, revisiting our investment strategies, suspending our share buyback program until further notice, and reducing payroll costs, including through delayed hiring of new colleagues, and temporarily reducing salaries for existing colleagues.

We expect to have the ability to meet our cash needs for the foreseeable future through the use of cash and cash equivalents, Short-term investments, funds available under our Credit Facilities and commercial paper programs, and cash flows from operations. Additionally, Short-term investments included in our liquidity portfolio are expected to be highly liquid, giving us the ability to readily convert them to cash, as deemed appropriate. We believe our liquidity position at March 31, 2020 remains strong and as we move into a period of uncertain economic conditions related to COVID-19, which may impact our ability to access capital markets or other sources of liquidity, we will continue to closely monitor and protectively manage our liquidity as economic conditions change.

Cash on our balance sheet includes funds available for general corporate purposes, as well as amounts restricted as to their use. Funds held on behalf of clients in a fiduciary capacity are segregated and shown together with uncollected insurance premiums in Fiduciary assets in ~~the~~our Condensed Consolidated Statements of Financial Position, with a corresponding amount in Fiduciary liabilities. ~~Fiduciary funds generally cannot be used for general corporate purposes, and are not a source of liquidity for us.~~

~~Operating Activities~~

Net cash provided by operating activities during the nine months ended September 30, 2017 decreased $1,122 million, or 76%, to $353 million from the prior year period. Net cash provided by operating activities for continuing operations during the nine months ended September 30, 2017 decreased $863 million, or 75%, from the prior year period to $289 million. Net cash provided by operating activities for discontinued operations during the nine months ended September 30, 2017 decreased $259 million, or 80%, from the prior year period to $64 million. These amounts represent net income reported, as adjusted for gains or losses on sales of businesses, financial instruments and foreign exchange, and our non-cash expenses, which include share-based compensation, depreciation, and amortization and impairments, as well as changes in working capital that relate primarily to the timing of payments of accounts payable and accrued liabilities and collection of receivables. The total decrease in operating cash inflows from the prior year was primarily driven by higher cash tax charges, largely related to the sale of the Divested Business, and an increase in pension contributions.

Pension contributions were $109 million for the nine months ended September 30, 2017, as compared to $91 million for the nine months ended September 30, 2016. For the remainder of 2017, we expect to contribute approximately $40 million in cash to our pension plans, with the majority attributable to non-U.S. pension plans, which are subject to changes in foreign exchange rates. On July 1, 2017, the Company made non-cash contributions of approximately $80 million to its U.S. pension plan.

We expect cash generated by operations for 2017 to be sufficient to service our debt and contractual obligations, finance capital expenditures, continue purchases of shares under the Repurchase Program, and continue to pay dividends to our shareholders. Although cash from operations is expected to be sufficient to service these activities, we have the ability to access the commercial paper markets or borrow under our credit facility to accommodate any timing differences in cash flows. We have a committed credit facility totaling $900 million, all of which was available at September 30, 2017, and can access this facility on a same day or next day basis. In October 2017, we entered into a $400 million multi-currency U.S. credit facility, which increases our available facilities to $1.3 billion. Additionally, under current market conditions, we believe that we could access capital markets to obtain debt financing for longer-term funding, if needed.

~~Investing Activities~~

Cash flow provided by investing activities was $2,522 million during the nine months ended September 30, 2017. During the nine months ended September 30, 2017, cash flow provided by investing activities in continuing operations was $2,541 million and cash flow used for investing activities in discontinued operations was $19 million. The primary driver of cash flow provided by investing activities was $4,194 million of sales of businesses, net of cash sold, offset by $1,344 million in net purchases of short-term investments, $172 million of acquisitions of businesses, net of cash acquired, and $144 million of capital expenditures in continuing and discontinued operations, and $12 million of net purchases of long-term investments. The gains and losses corresponding to cash flows provided by the net sales of long-term investments are recognized in Other income (expense) in the Condensed Consolidated Statements of Income.

Cash flow used for investing activities was $371 million during the nine months ended September 30, 2016. During the nine months ended September 30, 2016, cash flow used for investing activities in continuing operations was $325 million and cash flow used for investing activities in discontinued operations was $46 million. The primary drivers of cash flow used for investing activities were $198 million of acquisitions of businesses, net of cash acquired, $153 million of capital expenditures in continuing and discontinued operations, $108 million in net purchases of short-term investments, and $16 million of net purchases of long-term investments, offset by $104 million in proceeds from the sale of businesses.

~~Financing Activities~~

Cash flow used for financing activities during the nine months ended September 30, 2017 was $2,648 million, all of which was related to continuing operations. The primary drivers of cash flow used for financing activities were $1,888 million of share repurchases, $347 million of repayments of debt, net of issuances, $274 million of dividends paid to shareholders, $118 million in net cash payments related to issuance of shares, and $21 million of transactions with noncontrolling interests and other financing activities.

Cash flow used for financing activities during the nine months ended September 30, 2016 was $1,015 million, all of which was related to continuing operations. The primary drivers of cash flow used for financing activities were $1,037 million of share repurchases, $258 million of dividends paid to shareholders, $71 million of transactions with noncontrolling interests and other

~~financing activities, and $70 million in net cash payments related to issuance of shares, partially offset by $421 million of issuances of debt, net of repayments.~~

~~Cash and Cash Equivalents and Short-Term Investments~~

At September 30, 2017, our Cash and cash equivalents and Short-term investments were $2,389 million, an increase of $1,673 million from December 31, 2016. This increase was primarily related to $4,194 million received in connection with the Divested Business and $353 million cash provided by operations, partially offset by $1,888 million in share repurchases, $347 million in repayments of debt issuances, net of issuances, $274 million in dividends, $172 million in acquisitions of businesses, net of cash acquired, and $144 million of capital expenditures. Of the total balance at September 30, 2017, $98 million was restricted as to its use, which was comprised of £42.7 million ($57.5 million at September 30, 2017 exchange rates) of operating funds in the U.K., as required by the FCA, and $40 million held as collateral for various business purposes. At September 30, 2017, $4.7 billion of Cash and cash equivalents and Short-term investments were held in the U.S. and overdrawn Cash and cash equivalents and Short-term investments of $2.3 billion were held in other countries. We maintain multicurrency cash pools with third-party banks in which various Aon entities participate. Individual Aon entities are permitted to overdraw on their individual accounts provided the overall global balance does not fall below zero. At September 30, 2017, non-U.S. cash balances of one or more entities were negative; however, the overall balance was positive.

Of the total balance of Cash and cash equivalents and Short-term investments at December 31, 2016, $82 million was restricted as to its use, which was comprised of £43.3 million ($53.2 million at December 31, 2016 exchange rates) of operating funds in the U.K., as required by the FCA, and $29 million held as collateral for various business purposes. At December 31, 2016, $1.9 billion of cash and cash equivalents and short-term investments were held in the U.S. and overdrawn Cash and cash equivalents and Short-term investments of $1.2 billion were held in other countries.

In our capacity as an insurance broker or agent, we collect premiums from insureds and, after deducting our commission, remit the premiums to the respective insurance ~~underwriter.~~underwriters. We also collect claims or refunds from underwriters on behalf of insureds, which are then returned to the insureds. Unremitted insurance premiums and claims are held by us in a fiduciary capacity. In addition, some of our outsourcing agreements require us to hold funds on behalf of clients to pay obligations on their behalf. The levels of fiduciary assets and liabilities can fluctuate significantly, depending on when we collect premiums, claims, and refunds, make payments to underwriters and insureds, and collect funds from clients and make payments on their behalf, and upon the ~~movement~~impact of foreign currency ~~exchange rates.~~movements. Fiduciary assets, because of their nature, are generally invested in very liquid securities with ~~highly-rated,~~highly rated, credit-worthy financial institutions. In our Condensed Consolidated Statements of Financial Position, the amounts we report for Fiduciary assets and Fiduciary liabilities are ~~equal.~~equal and offsetting. Our Fiduciary assets included cash and short-term investments of ~~$4.2~~$5.2 billion and ~~$3.3~~$5.2 billion at ~~September 30, 2017~~March 31, 2020 and December 31, ~~2016,~~2019, respectively, and fiduciary receivables of ~~$5.0~~$7.2 billion and ~~$5.7~~$6.7 billion at ~~September 30, 2017~~March 31, 2020 and December 31, ~~2016,~~2019, respectively. While we earn investment income on the fiduciary assets held in cash and investments, the cash and investments cannot be used for general corporate purposes.

We maintain multicurrency cash pools with third-party banks in which various Aon entities participate. Individual Aon entities are permitted to overdraw on their individual accounts provided the overall global balance does not fall below zero. At March 31, 2020, non-U.S. cash balances of one or more entities were negative; however, the overall balance was positive.

The following table summarizes our Cash and cash equivalents, Short-term investments, and Fiduciary assets as of March 31, 2020 (in millions):



	Statement of Financial Position Classification
Asset Type	Cash and Cash Equivalents		Short-term Investments		Fiduciary Assets		Total
Certificates of deposit, bank deposits or time deposits	$	690	$	—	$	3,113	$	3,803
Money market funds	—		170		2,081		2,251
Cash and short-term investments	690		170		5,194		6,054
Fiduciary receivables	—		—		7,207		7,207
Total	$	690	$	170	$	12,401	$	13,261

Cash and cash equivalents decreased $100 million in 2020. A summary of our cash flows provided by and used for operations from operating, investing, and financing activities is as follows (in millions):



	Three Months Ended March 31,
	2020			2019
Cash provided by operating activities	$	338		$	74
Cash provided by (used for) investing activities	$	(438	)	$	(27	)
Cash used for financing activities	$	82		$	(140	)
Effect of exchange rates changes on cash and cash equivalents	$	(82	)	$	37

Operating Activities

Net cash provided by operating activities during the three months ended March 31, 2020 increased $264 million, or 357%, from the prior year period to $338 million. This amount represents net income reported, as adjusted for gains or losses on sales of businesses, share-based compensation expense, depreciation expense, amortization and impairments, and other non-cash income and expenses, as well as changes in working capital that relate primarily to the timing of payments of accounts payable and accrued liabilities and collection of receivables.

Pension Contributions

Pension contributions were $35 million for the three months ended March 31, 2020, as compared to $47 million for the three months ended March 31, 2019. For the remainder of 2020, we expect to contribute approximately $88 million in cash to our pension plans, including contributions to non-U.S. pension plans, which are subject to changes in foreign exchange rates.

Investing Activities

Cash flow used for investing activities was $438 million during the three months ended March 31, 2020, an increase of $411 million compared to $27 million of cash flow used for investing activities in the prior year period. Generally, the primary drivers of cash flow used for investing activities are acquisition of businesses, purchases of short-term investments, capital expenditures, and payments for investments. Generally, the primary drivers of cash flow provided by investing activities are sales of businesses, sales of short-term investments, and proceeds from investments. The gains and losses corresponding to cash flows provided by proceeds from investments and used for payments for investments are primarily recognized in Other income (expense) in our Condensed Consolidated Statements of Income.

Short-term Investments

Short-term investments increased $32 million as compared to December 31, 2019. As disclosed in Note 15 “Fair Value Measurements and Financial Instruments” of ~~Notes to the Condensed Consolidated~~our Financial Statements contained in Part I, Item 1 of this report, the majority of our investments carried at fair value are money market funds. These money market funds are held throughout the world with various financial institutions. We are not aware of any market liquidity issues that would materially impact the fair value of these investments.

~~At September 30, 2017, our investments~~Acquisitions and Dispositions of Businesses

During the first three months of 2020, we completed the acquisition of five business for a total consideration of $334 million, net of cash acquired, and one businesses was sold for a net cash inflow of $30 million.

During the first three months of 2019, we completed the acquisition of one business for a total consideration of $22 million, net of cash acquired, and one business was sold for an insignificant amount.

Capital Expenditures

Our additions to fixed assets, including capitalized software, which amounted to $59 million and $57 million for the three months ended March 31, 2020 and 2019, respectively, primarily relate to computer equipment purchases, the refurbishing and modernizing of office facilities, and software development costs.

Financing Activities

Cash flow provided by financing activities during the three months ended March 31, 2020 was $82 million, an increase of $222 million compared to prior year period. The primary drivers of cash flow provided by financing activities are share repurchases, issuances of debt, net of repayments, dividends paid to shareholders, issuances of shares for employee benefit plans, transactions with noncontrolling interests, and other financing activities, such as collection of or payments for deferred consideration in ~~money market funds had a fair value of $3.1 billion~~connection with prior-year business acquisitions and ~~are reported as Short-term investments or Fiduciary assets in the Condensed Consolidated Statements of Financial Position depending on their nature.~~divestitures.

~~The following table summarizes our Fiduciary assets, non-fiduciary Cash and cash equivalents, and Short-term investments at September 30, 2017 (in millions):~~

Statement of Financial Position Classification
Asset Type
Cash and Cash
Equivalents

Short-term
Investments

Fiduciary
Assets
Total
Certificates of deposit, bank deposits or time deposits $ 749
$ —
$ 2,796
$ 3,545
Money market funds
—
1,640
1,451
3,091
Cash and short-term investments 749
1,640
4,247
6,636
Fiduciary receivables —
—
5,045
5,045
Total $ 749
$ 1,640
$ 9,292
$ 11,681

Share Repurchase Program

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

~~Under the~~ The Repurchase Program ~~Class A Ordinary Shares may be repurchased through the open market or in privately negotiated transactions, based~~was adopted by Aon Ireland’s Board of Directors on ~~prevailing market conditions, and will be funded from available capital. In the three months ended September 30, 2017, the Company repurchased 5.4 million shares at an average price~~April 1, 2020.

The following table summarizes our Share Repurchase activity (in millions, except per share of $139.61, for a total cost of approximately $749 million and recorded an additional $3.8 million of costs associated with the repurchases to retained earnings. During the nine months ended September 30, 2017, the Company repurchased 14.5 million shares at an average price per share of $131.58, for a total cost of approximately $1.9 billion and recorded an additional $9.5 million of costs associated with the repurchases to retained earnings. Included in the 5.4 million shares and 14.5 million shares repurchased during the three and nine months ended September 30, 2017 were 165 thousand shares that did not settle until October 2017. These shares were settled at an average price per share of $146.52 and total cost of $24.2 million. In the three months ended September 30, 2016, the Company repurchased 2.7 million shares at an average price per share of $110.26 for a total cost of approximately $301 million. During the nine months ended September 30, 2016, the Company repurchased 10.4 million shares at an average price per share of $101.16, for a total cost of approximately $1.1 billion.data):



	Three Months Ended March 31,
	2020		2019
Shares repurchased	2.2		0.6
Average price per share	$	212.78	$	161.16
Costs recorded to retained earnings
Total repurchase cost	$	461	$	100
Additional associated costs	2		1
Total costs recorded to retained earnings	$	463	$	101

At ~~September 30, 2017,~~March 31, 2020, the remaining authorized amount for share repurchase under the Repurchase Program ~~is approximately $5.9~~was $1.6 billion. Under the Repurchase Program, we have repurchased a total of ~~104.7~~130.9 million shares for an aggregate cost of approximately ~~$9.1~~$13.4 billion.

For further information regarding share repurchases made during the ~~third~~first quarter of ~~2017,~~2020, see Part II, Item 2 of this report. Additionally, due to COVID-19, we have temporarily suspended share repurchases as we proactively manage liquidity.

Borrowings

Total debt at March 31, 2020 was $8.1 billion, an increase of $0.8 billion compared to December 31, 2019. Further, commercial paper activity during the three months ended March 31, 2020 and 2019 is as follows (in millions):



	Three Months Ended March 31,
	2020			2019
Total issuances ⁽¹⁾	$	2,060		$	871
Total repayments	$	(1,341	)	$	(694	)
Net issuances	$	719		$	177


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

In March 2020, our $400 million 2.80% Senior Notes due March 2021 were classified as Short-term debt and current portion of long-term debt in our Condensed Consolidated Statement of Financial Position as the date of maturity is in less than one year.

On November 15, 2019, Aon Corporation issued $500 million 2.20% Senior Notes due November 2022. We used the net proceeds of the offering to pay down a portion of outstanding commercial paper and for general corporate purposes.

In September 2019, our $600 million 5.00% Senior Notes due September 2020 were classified as Short-term debt and current portion of long-term debt in our Condensed Consolidated Statement of Financial Position as the date of maturity is in less than one year.

On May 2, 2019, Aon Corporation issued $750 million 3.75% Senior Notes due May 2029. We used the net proceeds of the offering to pay down a portion of outstanding commercial paper and for general corporate purposes.

Other Liquidity Matters

Distributable ~~Reserves~~Profits

~~As a company incorporated in England and Wales, we are~~In connection with the Ireland Reorganization, the Company is required under ~~U.K.~~Irish law to have available “distributable ~~reserves”~~profits” to make share repurchases or pay dividends to shareholders. Refer to Note 19 “Subsequent Events” for further information on the Ireland Reorganization. Distributable ~~reserves~~profits are created through the earnings of the ~~U.K.~~Irish parent ~~company.~~company and, among other methods, through intercompany dividends or a reduction in share capital approved by the High Court of Ireland. Distributable ~~reserves~~profits are not linked to a U.S. GAAP reported amount (e.g., retained earnings). As of ~~September 30, 2017~~March 31, 2020 and December 31, ~~2016,~~2019, we had distributable ~~reserves~~profits in excess of ~~$1.8~~$31.8 billion and ~~$1.6~~$32.4 billion, ~~respectively.~~respectively, associated with Aon UK. Following the Ireland Reorganization, we must reestablish distributable profits of the parent entity and will regularly create distributable profits as required to meet our capital needs. We believe that we ~~will~~ have the ability to create sufficient distributable ~~reserves to fund shareholder dividends, if and to the extent declared,~~profits for the foreseeable future. As of May 1, 2020, the Company has $120 million of distributable profits.

~~Borrowings~~Credit Facilities

~~Total~~We expect cash generated by operations for 2020 to be sufficient to service our debt ~~at September 30, 2017 was $6.0 billion, a decrease of $238 million compared~~and contractual obligations, finance capital expenditures, and continue to ~~December 31, 2016. Commercial paper activity during~~pay dividends to our shareholders. Although cash from operations is expected to be sufficient to service these activities, we have the ~~three and nine months ended September 30, 2017 and 2016 is as follows:~~

Three Months Ended Nine Months Ended
September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016
Total Issuances $ —
$ 674
$ 1,648
$ 1,982
Total Repayments $ —
$ (674 ) $ (1,997 ) $ (1,798 )

~~The proceeds of~~ability to access the commercial paper ~~issuances were used primarily~~markets or borrow under our credit facilities to accommodate any timing differences in cash flows. Additionally, under current market conditions, we believe that we could access capital markets to obtain debt financing for ~~short-term working capital needs.~~

~~Credit Facilities~~longer-term funding, if needed.

As of ~~September 30, 2017, Aon plc~~March 31, 2020, we had ~~one~~two primary committed credit ~~facility~~facilities outstanding: ~~its~~our $900 million multi-currency U.S. credit facility expiring in February ~~2021 (the “2021 Facility”). On October 19, 2017, Aon entered into a $400~~2022 and our $750 million multi-currency U.S. credit facility expiring in October ~~2022 (the “2022 Facility”). This facility replaced~~2023. Effective February 27, 2020, the ~~previous $400~~$750 million multi-currency U.S. credit facility ~~that expired~~was increased by $350 million from the original $400 million. In aggregate, these two facilities provide $1.65 billion in ~~March 2017. The 2021 facility is intended to support our commercial paper obligations and our general working capital needs. In addition, this facility~~available credit.

Each of these primary committed credit facilities includes customary representations, warranties, and covenants, including financial covenants that require us to maintain specified ratios of adjusted consolidated EBITDA to consolidated interest expense and consolidated debt to consolidated adjusted ~~consolidated~~ EBITDA, tested quarterly. ~~During the second quarter of 2017, Aon amended the consolidated EBITDA definition within our 2021 Facility to exclude non-cash pension expenses and restructuring charges,~~At March 31, 2020, we did not ~~to exceed the total estimated costs of $750 million. At September 30, 2017, we had no~~have borrowings under either facility, and we were in compliance with ~~these~~the financial covenants and all other covenants contained ~~in the 2021 Facility~~therein during the ~~three and nine~~rolling 12 months ended ~~September 30, 2017.~~March 31, 2020.

~~Our total debt-to-EBITDA ratio at September 30, 2017 and 2016 based on a rolling twelve months is calculated as follows (in millions):~~Commercial Paper

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

On April 1, 2020 we entered into an agreement increasing the aggregate outstanding borrowings under or U.S. commercial paper program by $300 million, to an aggregate amount equal to $900 million. The debt-to-EBITDA ratio was retrospectively restated to exclude the impact of discontinued operations related to the sale of the Divested Business. Refer to Note 3 “Discontinued Operations” of Notes to Condensed Consolidated Financial Statements for further information.

~~We use EBITDA for continuing operations, as defined~~U.S. Program remains fully backed by our financial covenants, as a non-GAAP measure. This supplemental information related to EBITDA represents a measure not in accordance with U.S. GAAP and should be viewed in addition to, not instead of, our Condensed Consolidated Financial Statements and Notes thereto.committed credit facilities.

Shelf Registration Statement

On September ~~3, 2015,~~25, 2018, we filed a shelf registration statement with the ~~U.S. Securities and Exchange Commission (the “SEC”),~~SEC, registering the offer and sale from time to time of an indeterminate amount of, among other securities, debt securities, preference shares, Class A Ordinary Shares and convertible securities. We expect to file a new or amended shelf registration statement in the second quarter of 2020 to register securities of Aon Ireland. Our ability to access the market as a source of liquidity is dependent on investor demand, market conditions, and other factors.

Rating Agency Ratings

The major rating agencies’ ratings of our debt at ~~October 27, 2017~~April 30, 2020 appear in the table below.



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

AOn March 11, 2020, Fitch Inc. (“Fitch”) placed our ‘BBB+’ rating on Rating Watch Negative (versus a prior Stable Outlook) following the announcement of the Combination. Negative Watch indicates that our Fitch rating could stay at its present level or potentially be downgraded. In its rating action commentary published March 11, Fitch states “rating expectations will unfold after further transaction details emerge and after Fitch evaluates both companies ongoing financial results prior to the projected first half 2021 closing”. We are committed to managing our current investment grade ratings. Any downgrade in the credit ratings of our senior debt ~~and~~or commercial paper could increase our borrowing costs, reduce or eliminate our access to capital, reduce our financial flexibility, ~~increase our commercial paper interest rates, or~~ restrict our access to the commercial paper market altogether, ~~and/~~or impact future pension contribution requirements.

Guarantees ~~and Indemnifications~~

in Connection with the Sale of the Divested Business

In connection with the 2017 sale of the Divested Business, we guaranteed future operating lease commitments related to certain facilities assumed by the Buyer. We are obligated to perform under the guarantees if the Divested Business defaults on the leases at any time during the remainder of the lease agreements, which expire on various dates through ~~2024.~~2025. As of ~~September 30, 2017,~~March 31, 2020, the undiscounted maximum potential future payments under the lease guarantee were ~~$104~~$66 million, with an estimated fair value of ~~$25~~$11 million. No cash payments were made in connection to the lease commitments during the three ~~or nine~~ months ended ~~September 30, 2017.~~March 31, 2020.

Additionally, we are subject to performance guarantee requirements under certain client arrangements that were assumed by the Buyer. Should the Divested Business fail to perform as required by the terms of the arrangements, we would be required to fulfill the remaining contract terms, which expire on various dates through 2023. As of ~~September 30, 2017,~~March 31, 2020, the undiscounted maximum potential future payments under the performance guarantees were ~~$395~~$139 million, with an estimated fair value of $4$1 million. No cash payments were made in connection to the performance guarantees during the three ~~or nine~~ months ended ~~September 30, 2017.~~March 31, 2020.

Letters of Credit and Other Guarantees

We have entered into a number of arrangements whereby our performance on certain obligations is guaranteed by a third party through the issuance of a letter of ~~credit (“LOCs”).~~credit. We had total LOCs outstanding of approximately ~~$94~~$71 million at ~~September 30, 2017,~~March 31, 2020, compared to ~~$90~~$73 million at December 31, ~~2016.~~2019. These LOCs cover the beneficiaries related to certain of our U.S. and Canadian non-qualified pension plan schemes and secure deductible retentions for our own workers compensation program. We also have obtained LOCs to cover contingent payments for taxes and other business obligations to third parties, and other guarantees for miscellaneous purposes at our international subsidiaries.

We have certain contractual contingent guarantees for premium payments owed by clients to certain insurance companies. The maximum exposure with respect to such contractual contingent guarantees was approximately ~~$76~~$70 million at ~~September 30, 2017,~~March 31, 2020, compared to ~~$95~~$110 million at December 31, ~~2016.~~2019.

Off-Balance Sheet Arrangements

Apart from commitments, guarantees, and contingencies, as disclosed herein and Note 16 “Claims, Lawsuits, and Other ~~Liquidity Matters~~

~~We do not have significant exposure related~~Contingencies” to our Financial Statements contained in Part I, Item 1 of this report, we had no off-balance sheet ~~arrangements.~~arrangements that have, or are reasonably likely to have, a current or future material effect on our financial condition, results of operations, or liquidity. Our cash flows from operations, borrowing availability, and overall liquidity are subject to risks and uncertainties. See “Information Concerning Forward-Looking Statements” below.

~~Financial Condition~~

At September 30, 2017, our net assets, representing total assets minus total liabilities, were $5,247 million, a decrease from $5,532 million at December 31, 2016. The decrease was due primarily to $1,913 million of share repurchases and $274 million of dividend payments for the nine months ended September 30, 2017, partially offset by Net income of $1,275 million, a decrease of $500 million in Accumulated other comprehensive loss, and an increase of $49 million due to the adoption of the share-based compensation guidance in the first quarter of 2017. Working capital increased by $1,142 million to $1,793 million from December 31, 2016.

~~Accumulated Other Comprehensive Loss~~

~~Accumulated other comprehensive loss decreased $500 million to $3,412 million at September 30, 2017 as compared to $3,912 million at December 31, 2016, which was primarily driven by the following:~~

~~positive net foreign currency translation adjustments of $431 million, which are attributable to the weakening of the U.S. dollar against certain foreign currencies;~~

~~an increase of $56 million due to the amortization of net actuarial losses related to pension obligations; and~~

~~net financial instrument gains of $13 million.~~

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

There have been no changes in our critical accounting policies, which include revenue recognition, pensions, goodwill and other intangible assets, contingencies, share-based payments, and income taxes, as discussed in our Annual Report on Form 10-K for the year ended December 31, ~~2016 ( our “2016~~2019, including amendments and additions disclosed on Form 8-K issued April 1, 2020 (our “2019 Annual Report on Form 10-K”) other than those described below.

~~Restructuring~~

~~Workforce reduction costs~~

~~The method used to account for workforce reduction costs depends on whether~~Goodwill and Other Intangible Assets

Goodwill represents the costs result from an ongoing severance plan or are one-time costs. We account for relevant expenses as severance costs when we have an established severance policy, statutory requirements dictate the severance amounts, or we have an established patternexcess of ~~paying by a specific formula. We recognize these costs when the likelihood of future settlement is probable and the amount of the related benefit is reasonably estimable, or on a straight-line basis~~cost over the ~~remaining service period, if applicable.~~

We estimate our one-time workforce reduction costs related to exit and disposal activities not resulting from an ongoing severance plan based on the benefits available to the employees being terminated. We recognize these costs when we identify the specific classification (or functions) and locations of the employees being terminated, notify the employees who might be included in the termination, and expect to terminate employees within the legally required notification period. When employees are receiving incentives to stay beyond the legally required notification period, we record the cost of their severance over the remaining service period.

~~Lease consolidation costs~~

~~Where we have provided notice of cancellation pursuant to a lease agreement or abandoned space and have no intention of reoccupying it, we recognize a loss. The loss reflects our best estimate~~fair market value of the net ~~present~~assets acquired. We classify our intangible assets acquired as either tradenames, customer-related and contract-based, or technology and other.

Goodwill is not amortized, but rather tested for impairment at least annually in the fourth quarter. We test more frequently if there are indicators of impairment or whenever business circumstances suggest that the carrying value of ~~the~~goodwill may not be recoverable. These indicators may include a sustained significant decline in our share price and market capitalization, a decline in our expected future cash flows, ~~associated with~~or a significant adverse change in legal factors or in the ~~lease~~business climate, among others.

We perform impairment reviews at the ~~date~~reporting unit level. A reporting unit is an operating segment or one level below an operating segment (referred to as a “component”). A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of that component. An operating segment shall be deemed to be a reporting unit if all of its components are similar, if none of its components are a reporting unit, or if the segment comprises only a single component.

When evaluating these assets for impairment, we ~~provide notice of cancellation in accordance with contractual terms, vacate the property,~~may first perform a qualitative assessment to determine whether it is more likely than not that a reporting unit is impaired. If we do not perform a qualitative assessment, or ~~sign a sublease arrangement. To~~if we determine the loss, we estimate sublease income based on current market quotes for similar properties. When we finalize definitive agreements with the sublessee, we adjust our sublease losses for actual outcomes.

~~Fair value concepts of one-time workforce reduction costs and lease losses~~

~~Accounting guidance requires~~ that ~~our exit and disposal accruals reflect~~it is not more likely than not that the fair value of the ~~liability. Where material,~~reporting unit exceeds its carrying amount, then the goodwill impairment test becomes a quantitative analysis. If the fair value of a reporting unit is determined to be greater than the carrying value of the reporting unit, goodwill is deemed not to be impaired and no further testing is necessary. If the fair value of a reporting unit is less than the carrying value, a goodwill impairment loss is recognized for the amount that the carrying amount of a reporting unit, including goodwill, exceeds its fair value limited to the total amount of the goodwill allocated to the reporting unit.

In determining the fair value of our reporting units, we use a discounted cash flow (“DCF”) model based on our most current forecasts. We discount the ~~lease loss calculations to arrive~~related cash flow forecasts using the weighted average cost of capital method at ~~their net present value. Most workforce reductions happen over a short span~~the date of ~~time, so no discounting is necessary.~~

~~For the remaining lease term, we decrease the liability for payments~~evaluation. Preparation of forecasts and ~~increase the liability for accretion~~selection of the discount ~~if material. The discount reflects our incremental borrowing~~ rate ~~which matches~~for use in the ~~lifetime of the liability. Significant~~DCF model involve significant judgments, and changes in these estimates could affect the ~~discount rate selected~~estimated fair value of one or more of our reporting units and could result in a goodwill impairment charge in a future period. We also use market multiples which are obtained from quoted prices of comparable companies to corroborate our DCF model results. The combined estimated fair value of our reporting units from our DCF model often results in a premium over our market capitalization, commonly referred to as a control premium. We believe the ~~estimations~~implied control premium determined by our impairment analysis is reasonable based upon historic data of ~~sublease income~~premiums paid on actual transactions within our industry.

We review intangible assets that are being amortized for impairment whenever events or changes in circumstance indicate that their carrying amount may not be recoverable. If we are required to record impairment charges in the ~~case~~future, they could materially impact our results of ~~leases could impact the amounts recorded.~~operations.

~~Asset impairments~~

Asset impairments are accounted for in the period when they become known. Furthermore, we record impairments by reducing the book value to the net present value of future cash flows (in situations where the asset had an identifiable cash flow stream) or accelerating the depreciation to reflect the revised useful life. Asset impairments are included in Depreciation in the Condensed Consolidated Statements of Income.

~~Other associated costs of exit and disposal activities~~

~~We recognize other costs associated with exit and disposal activities as they are incurred, including separation costs, moving costs and consulting and legal fees.~~

NEW ACCOUNTING PRONOUNCEMENTS

Note 2 “Accounting Principles and Practices” to ~~the Condensed Consolidated~~our Financial Statements contained in Part I, Item 1 of this report contains a discussion of recently issued accounting pronouncements and their impact or future potential impact on our financial results, if determinable.

INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS

This report and reports we will subsequently file or furnish and have previously filed or furnished with the SEC ~~contains~~contain certain statements related to future results, or ~~states~~state our intentions, beliefs and expectations or predictions for the future, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements relate to expectations or forecasts of future events. They ~~use~~are typically identified by words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “project,” “intend,” “plan,” “probably,” “potential,” “looking forward,” “continue,” and other similar terms, and future or conditional tense verbs like “could,” “may,” “might,” “should,” ~~“will”~~“will,” and “would.” You can also identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. For example, we may use forward-looking statements when addressing topics such as: market and industry conditions, including competitive and pricing trends; public health concerns and continuing uncertainty in connection with COVID-19; changes in our business strategies and methods of generating revenue; the development and performance of our services and products; changes in the composition or level of our ~~revenue;~~revenues; our cost structure and the outcome of cost-saving or restructuring initiatives; the outcome of contingencies; dividend policy; the expected impact of acquisitions and dispositions; pension obligations; cash flow and liquidity; expected effective tax rate; future actions by regulators; risks related to the Combination; and the impact of changes in accounting rules. ~~These forward-looking~~Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from either historical or anticipated results depending on a variety of factors. Potential factors, which may be revised or supplemented in subsequent reports filed or furnished with the SEC, that could impact results include:

general economic and political conditions in ~~different~~the countries in which we do business around the ~~world;~~world, including the withdrawal of the U.K. from the European Union;

changes in the competitive ~~environment;~~environment or damage to our reputation;

fluctuations in exchange and interest rates that could influence revenues and expenses;

changes in global equity and fixed income markets that could affect the return on invested assets;

changes in the funding status of our various defined benefit pension plans and the impact of any increased pension funding resulting from those changes;

the level of our debt limiting financial flexibility or increasing borrowing costs;

rating agency actions that could affect our ability to borrow funds;

~~the effect~~volatility in our tax rate due to a variety of ~~the change in global headquarters and jurisdiction of incorporation,~~different factors including ~~differences in the anticipated benefits;~~U.S. federal income tax reform;

changes in estimates or assumptions on our financial statements;

limits on our subsidiaries to make dividend and other payments to us;

the impact of lawsuits and other contingent liabilities and loss contingencies arising from errors and omissions and other claims against us;

the impact of, and potential challenges in complying with, legislation and regulation in the jurisdictions in which we operate, particularly given the global scope of our businesses and the possibility of conflicting regulatory requirements across jurisdictions in which we do business;

the impact of any investigations brought by regulatory authorities in Ireland, the U.S., U.K., and other countries;

the impact of any inquiries relating to compliance with the U.S. Foreign Corrupt Practices Act and non-U.S. anti-corruption laws and with U.S. and non-U.S. trade sanctions regimes;

failure to protect intellectual property rights or allegations that we infringe on the intellectual property rights of others;

the effects of ~~English~~Irish law on our operating flexibility and the enforcement of judgments against us;

the failure to retain and attract qualified personnel;

international risks associated with our global operations;

the ~~effect~~effects of natural or man-made ~~disasters;~~disasters, including the effects of COVID-19 and other health pandemics;

the potential of a system or network breach or disruption resulting in operational interruption or improper disclosure of personal data;

our ability to develop and implement new technology;

damage to our reputation among clients, markets or third parties;

the actions taken by third parties that perform aspects of our business operations and client services;

the extent to which we manage certain risks created in connection with the various services, including fiduciary and ~~investments~~investment consulting and other advisory ~~services and business process outsourcing~~ services, among others, that we currently provide, or will provide in the future, to clients;

our ability to continue, and the costs and risks associated with, growing, developing and integrating companies that we acquire or new lines of business;

changes in commercial property and casualty markets, commercial premium rates or methods of compensation;

changes in the health care system or our relationships with insurance carriers;

our ability to implement initiatives intended to yield cost savings and the ability to achieve those cost savings;

~~our~~ risks and uncertainties ~~in connection~~associated with the sale of the Divested Business; ~~and~~

our ability to realize the expected benefits from our restructuring ~~plan.~~plan; and

risks and uncertainties associated with the Combination, including our ability to obtain the requisite approvals of, to satisfy the other conditions to, or to otherwise complete, the Combination on the expected time frame, or at all, the occurrence of unanticipated difficulties or costs in connection with the Combination, our ability to successfully integrate the combined companies following the Combination and our ability to realize the expected benefits from the Combination.

Any or all of our forward-looking statements may turn out to be inaccurate, and there are no guarantees about our performance. The factors identified above are not exhaustive. ~~Aon~~We and ~~its~~our subsidiaries operate in a dynamic business environment in which new risks may emerge frequently. Accordingly, readers should not place undue reliance on forward-looking statements, which speak only as of the dates on which they are made. We are under no obligation (and expressly disclaim any obligation) to update or alter any forward-looking statement that we may make from time to time, whether as a result of new information, future events or otherwise. Further information about factors that could materially affect Aon, including our results of operations and financial condition, is contained in ~~Part III, Item 1A Risk Factors of this report and in~~ the “Risk Factors” section in Part III, Item 1A of this report and in Part I, ~~“Item~~Item 1A ~~Risk Factors”~~ of our 2019 Annual Report on Form 10-K, ~~for the year ended December 31, 2016.~~ including amendments and additions disclosed on Form 8-K issued April 1, 2020.

These factors may be revised or supplemented in our subsequent ~~Quarterly Reports on Form 10-Q or Current Reports on Form 8-K.~~periodic filings with the SEC.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We are exposed to potential fluctuations in earnings, cash flows and the fair value of certain of our assets and liabilities due to changes in interest rates and foreign exchange rates. To manage the risk from these exposures, we enter into a variety of derivative instruments. We do not enter into derivatives or financial instruments for trading or speculative purposes.

The following discussion describes our specific exposures and the strategies we use to manage these risks. There have been no changes in our critical accounting policies for financial instruments and derivatives as discussed in our ~~2016~~2019 Annual Report on Form ~~10-K.~~10-K, including amendments and additions disclosed on Form 8-K issued April 1, 2020.

Foreign Exchange Risk

We are subject to foreign exchange rate risk. Our primary exposures include exchange rates between the U.S. ~~Dollar~~dollar and the ~~Euro,~~euro, the British ~~Pound,~~pound, the Canadian ~~Dollar,~~dollar, the Australian ~~Dollar,~~dollar, the Indian ~~Rupee,~~rupee, and the Japanese ~~Yen.~~yen. We use over-the-counter options and forward contracts to reduce the impact of foreign currency risk to our financial statements.

Additionally, some of our non-U.S. brokerage subsidiaries receive revenue in currencies that differ from their functional currencies. Our U.K. subsidiaries earn a portion of their revenue in U.S. ~~Dollars, Euro,~~dollars, euro, and Japanese ~~Yen,~~yen, but most of their expenses are incurred in British ~~Pounds.~~pounds. At ~~September 30, 2017,~~March 31, 2020, we have hedged approximately 45% of our U.K. subsidiaries’ expected exposures to U.S. ~~Dollar, Euro,~~dollar, euro, and Japanese ~~Yen~~yen transactions for the years ending December 31, ~~2017~~2020 and ~~2018,~~2021, respectively. We generally do not hedge exposures beyond three years.

We also use forward and option contracts to economically hedge foreign exchange risk associated with monetary balance sheet exposures, such as ~~inter-company~~intercompany notes and short-term assets and liabilities that are denominated in a non-functional currency and are subject to remeasurement.

The translated value of ~~revenue~~revenues and ~~expense~~expenses from our international brokerage operations are subject to fluctuations in foreign exchange rates. If we were to translate prior year results at current quarter exchange rates, diluted earnings per share would ~~increase by $0.01 and $0.06, respectively,~~have an unfavorable $0.03 impact during the three ~~and nine~~ months ended ~~September 30, 2017.~~March 31, 2020. Further, adjusted diluted earnings per share, a non-GAAP measure as defined and reconciled under the caption “Review of Consolidated Results — Adjusted Diluted Earnings Per Share,” would ~~increase by $0.01 and $0.02, respectively,~~have an unfavorable $0.03 impact during the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2020 if we were to translate prior year results at current quarter exchange rates.

Interest Rate Risk

Our fiduciary investment income is affected by changes in international and domestic short-term interest rates. We monitor our net exposure to short-term interest rates and, as appropriate, hedge our exposure with various derivative financial instruments. This activity primarily relates to brokerage funds held on behalf of clients in the U.S. and in continental Europe. A decrease in global short-term interest rates adversely affects our fiduciary investment income.

Item 4. Controls and Procedures

Evaluation of disclosure controls and procedures. We have conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this quarterly report of ~~September 30, 2017.~~March 31, 2020. Based on this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were effective such that the information relating to Aon, including our consolidated subsidiaries, required to be disclosed in our SEC reports is recorded, processed, summarized and reported within the time periods specified in appropriate statute, SEC rules and forms, and is accumulated and communicated to Aon’s management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in internal control over financial reporting.No changes in Aon’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) occurred during the quarter ended ~~September 30, 2017~~March 31, 2020 that have materially affected, or that are reasonably likely to materially affect, Aon’s internal control over financial reporting.

Part II Other Information

Item 1. Legal Proceedings

See Note 16 ~~“Commitments~~“Claims, Lawsuits, and ~~Contingencies — Legal”~~Other Contingencies” to ~~the Condensed Consolidated~~our Financial Statements contained in Part I, Item 1 of this report, which is incorporated by reference herein.

Item 1A. Risk Factors

The risk factors set forth in the “Risk Factors” section in Part I, ~~“Item 1A. Risk Factors”~~Item 1A of our 2019 Annual Report on Form 10-K, ~~for the year ended December 31, 2016~~including amendments and additions disclosed on Form 8-K issued April 1, 2020, reflect certain risks associated with existing and potential lines of business and contain “forward-looking statements” as discussed in Part I, Item 2 of this report. Readers should consider them in addition to the other information contained in this report as our business, financial condition or results of operations could be adversely affected if any of these risks actually occur. In the first quarter of 2020, we identified the following additional risk factors:

~~Except as otherwise described below, there were no material changes to the risk factors previously disclosed in our 2016 Annual Report on Form 10-K.~~Business Risks

~~We have added the risk factor “We may not realize all of the expected benefits from our restructuring plan.”~~

We have replaced the risk factor, “We are subject to various risks and uncertainties in connection with the pending sale of our Benefits and Administration and HR Business Process Outsourcing (BPO) Platform” with “We are subject to various risks and uncertainties in connection with the sale of our Benefits Administration and HR Business Process Outsourcing business.”

~~We may not realize all of the expected benefits from our restructuring plan.~~

In 2017, we initiated a global restructuring plan (the “Restructuring Plan”) in connection with the sale of our benefits administration and business process outsourcing business. The Restructuring Plan is intended to streamline operations across the organization and deliver greater efficiency, insight and connectivity. We expect these restructuring activities and related expenses to affect continuing operations through 2019, including an estimated 2,400 to 2,850 role eliminations. The Restructuring Plan is expected to result in cumulative costs of approximately $750 million through the end of the Restructuring Plan, consisting of approximately $303 million in employee termination costs, $146 million in IT rationalization costs, $80 million in real estate realization costs, $40 million in asset impairment costs, and $181 million in other costs associated with the restructuring. Included in the estimated $750 million is $50 million of estimated non-cash charges related to asset impairments and lease consolidations.

We estimate that our annualized savings from the Restructuring Plan will be approximately $400 million by the end of 2019. Actual total costs, savings and timing of the Restructuring Plan may vary from these estimates due to changes in the scope or assumptions underlying the Restructuring Plan. We therefore cannot assure that we will achieve the targeted savings. Unanticipated costs or unrealized savings in connection with the Restructuring Plan could adversely affect ourOur results of operations have been adversely affected and could be materially adversely affected in the future by the recent COVID-19 global pandemic.

In December 2019, a novel strain of coronavirus, COVID-19, was reported to have surfaced in Wuhan, China. Since then, COVID-19 has spread to multiple countries, including the United States, and has been declared a pandemic by the World Health Organization. The global spread and unprecedented impact of COVID-19 has created significant volatility, uncertainty, and economic disruption around the world.

The extent to which the COVID-19 pandemic impacts our business, operations, and financial ~~condition.~~

~~We are subject~~results will depend on numerous evolving factors that we may not be able to ~~various risks~~accurately predict, including: the ultimate geographic scope, severity, and ~~uncertainties in connection with the sale of our Benefits Administration and HR Business Process Outsourcing business.~~

On February 9, 2017, we entered into a Purchase Agreement with Tempo Acquisition, LLC to sell our benefits administration and business process outsourcing business to the Buyer, an entity controlled by affiliates of The Blackstone Group L.P. On May 1, 2017, the transaction was consummated and the Buyer purchased allduration of the ~~outstanding equity interests~~pandemic; the impact of the pandemic on worldwide macroeconomic conditions, including interest rates, employment rates, consumer confidence and spending, Gross Domestic Product (“GDP”), property values, and changes in client behavior, and foreign exchange rates in each of the ~~Divested Business’s subsidiaries, plus certain related assets,~~markets in which we operate; governmental, business, and individual actions that have been, and continue to be, taken in response to the pandemic, including business closures, travel restrictions, quarantines, changes in laws and regulations (including those changes that may provide for extended premium payment terms), and social distancing (which have caused us to modify our business practices as described below); a ~~purchase price~~decline in business and the ability of ~~(i) $4.3 billion~~counterparties to pay for our services on time or at all; an increased number of E&O claims in ~~cash paid at closing, subject to customary adjustments set forth in~~those areas impacted by the ~~Purchase Agreement, and (ii) deferred consideration of up to $500 million, plus the assumption of certain liabilities.~~

~~The Transaction carries inherent risks, including the risk that Aon will not earn the $500 million of additional consideration or otherwise realize the intended value of the Transaction,~~pandemic, as well as ~~risks connected~~an increase in the incidence or severity of E&O claims against us and our market partners; our ability to sell and provide our services, including due to the impact of travel restrictions, quarantines, social distancing, and alternative work arrangements; our ability to access capital markets or other sources of liquidity; the health of, and the effect of the pandemic on, our professionals; and potential effects on our internal controls, including those over financial reporting, as a result of changes in working environments for our employees and business partners.

The global spread of COVID-19 has caused us to modify our business practices (including restricting employee travel and meetings in person with ~~separating~~clients or prospective clients, employee work-from-home arrangements, and the ~~Divested Business from Aon. Because~~cancellation of physical participation in meetings, events, and conferences), and we may take further actions in the ~~Divested Business represented 19%~~future as may be required by government authorities or that we determine are in the best interests of our ~~gross revenues for the fiscal year 2016,~~employees, clients, and business partners.

The COVID-19 pandemic and measures taken by governmental authorities in response thereto have already had an adverse impact on certain areas of our business and results of operations, including demand for our services, revenue, and ~~financial condition may be materially adversely affected, or may not be accretive~~the trading price of our securities. In the last two weeks of March 2020, we experienced revenue declines in certain areas of business, primarily in the more discretionary areas of our business, a trend which we expect to ~~adjusted earnings per share as anticipated, if we fail to effectively reduce our overhead costs to reflect~~continue, and potentially worsen, into the ~~reduced scale~~second quarter of operations or fail to grow our other business as expected. Additionally, the separation of the Divested Businesses from the rest of Aon’s business will require significant resources, which may disrupt operations or divert management’s attention from Aon’s day-today operations2020 and ~~efforts to grow our other businesses.~~

Furthermore, we have entered into ongoing commercial arrangements with the Buyer. If we do not realize the intended benefits of these arrangements, it could affect our results of operations or adversely affect our relationship with clients, partners, colleagues

~~and other third parties. Additionally,~~beyond. In addition, if the ~~Divested Business does not deliver~~COVID-19 pandemic continues to create significant disruptions in the ~~level of service to which~~credit or financial markets, or impacts our ~~clients and partners are accustomed,~~credit ratings, it could adversely affect our ability to access capital on favorable terms or at all. Finally, the impact of the COVID-19 pandemic may heighten other risks discussed in our 2019 Annual Report on Form 10-K and this report, which could adversely affect our business, financial condition, results of operations, cash flows, and stock price.

Combination-Related Risks

The Combination is subject to customary closing conditions, including conditions related to required shareholder approvals and required regulatory approvals, and may not be completed on a timely basis, or at all, or may be completed on a basis that has a material impact on the value of the combined company.

The closing of the Combination is subject to a number of customary conditions, and there can be no assurance that the conditions to the closing of the Combination will be satisfied or waived (to the extent applicable). The failure to satisfy the required conditions could delay the closing of the Combination for a significant period of time or prevent the closing of the Combination from occurring at all. These closing conditions include, among others, the receipt of required approvals of our and WTW shareholders and the approval of the Combination by the High Court of Ireland. These closing conditions also include certain antitrust related clearances, including under the U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated thereunder, the EC Merger Regulation and the antitrust laws of the other required antitrust jurisdictions.

The governmental agencies from which the parties will seek certain approvals related to these conditions have broad discretion in administering the applicable governing regulations. As a condition to their approval of the Combination, agencies may impose requirements, limitations or costs or require divestitures or place restrictions on the conduct of the combined company’s business after the closing of the Combination. Such requirements, limitations, costs or restrictions could delay or prevent the closing of the Combination or have a material adverse effect on the combined company’s business and results of operations following the closing of the Combination.

In addition, the closing conditions include other legal and regulatory conditions, such as (i) the sanction by the High Court of Ireland of the Combination and the delivery of the court order to the Irish Registrar of Companies, (ii) the approval by the New York Stock Exchange of the listing of all our Class A ordinary shares to be issued in connection with the Combination and (iii) the absence of any law or order that restrains, enjoins, makes illegal or otherwise prohibits the closing of the Combination.

The Combination is also subject to other customary closing conditions, including: (i) the Business Combination Agreement not having been terminated in accordance with its terms; (ii) the accuracy of each party’s representations and warranties made in the Business Combination Agreement, subject to specified materiality standards; (iii) the absence of a material adverse effect with respect to each party since March 9, 2020; and (iv) the performance and compliance by each party of all of its obligations and compliance with all of its covenants under the Business Combination Agreement in all material respects. There can be no assurance that the conditions to the closing of the Combination will be satisfied or waived or that the Combination will be completed within the expected time frame, or at all.

In addition, if the Combination is not completed by March 9, 2021 (or June 9, 2021 or September 9, 2021, if extended under the terms thereof, if applicable, or such earlier date as may be specified by the Irish Takeover Panel), either we or WTW may choose not to proceed with the Combination. The parties can mutually decide to terminate the Business Combination Agreement at any time, before or after the receipt of the approval of our or WTW shareholders.

Failure to close the Combination could negatively impact our share price and future business and financial results.

If the Combination is not completed for any reason, including the failure of Aon shareholders or WTW shareholders to approve the required proposals at their respective special meetings, our ongoing business may be adversely affected and, without realizing any of the potential benefits of having closed the Combination, we will be subject to a number of risks, including the following:

we will be required to pay certain costs and expenses relating to the Combination;

if the Business Combination Agreement is terminated under specified circumstances, we may be obligated to reimburse certain transaction-related expenses of WTW or, if terminated under other circumstances related to a failure to obtain the required antitrust clearances, pay to WTW a termination fee equal to $1 billion;

we may experience negative reactions from the financial markets, including negative impacts on the market price of our securities;

the manner in which clients, vendors, business partners and other third parties perceive we may be negatively impacted, which in turn could affect our ability to compete for new business or to obtain renewals in the marketplace more broadly;

matters relating to the Combination (including integration planning) may require substantial commitments of time and resources by management, which could otherwise have been devoted to other opportunities that may have been beneficial to Aon;

the Business Combination Agreement restricts us, without WTW’s consent and subject to certain exceptions, from making certain acquisitions and taking other specified actions until the Combination occurs or the Business Combination Agreement terminates. These restrictions may prevent us from pursuing otherwise attractive business opportunities and making other changes to our business that may arise prior to the closing of the Combination or the termination of the Business Combination Agreement; and

We could be subject to litigation related to any failure to close the Combination or related to any enforcement proceeding commenced against us to perform our obligations under the Business Combination Agreement.

If the Combination does not close, these risks may materialize and may adversely affect our business, financial results and share price.

While the Combination is pending, we will be subject to business uncertainties related to our relationships with employees, clients and suppliers, which could adversely affect our business and operations. These uncertainties could also adversely affect the combined company following the Combination.

Uncertainty about the effect of the Combination on employees, clients and suppliers may have an adverse effect on Aon and, consequently, on the combined company. These uncertainties may impair our ability to attract, retain and motivate key personnel until the closing of the Combination and for a period of time thereafter, and could cause clients, suppliers and others who deal with Aon to seek to delay or defer business decisions, to change or terminate existing business relationships with Aon or potential clients to choose other partners instead of Aon or to take other actions as a result of the Combination that could negatively impact our and/or the combined company’s revenues, earnings and cash flows, as well as the market price of our and/or the combined company’s securities. Employee retention may be particularly challenging during the pendency of the Combination because employees may experience uncertainty about their future roles with the combined company. If, despite our retention efforts, key employees depart because of issues relating to the uncertainty and difficulty of integration or a desire not to remain with the combined company, the combined company’s business could be harmed and its ability to realize the anticipated benefits of the Combination could be adversely affected.

While the Combination is pending, we will be subject to contractual restrictions, which could adversely affect our respective business and operations.

Under the terms of the Business Combination Agreement, we are subject to certain restrictions on the conduct of our business prior to the closing of the Combination, which may adversely affect our ability to execute certain of our business and operational strategies, including the ability in certain cases to enter into contracts or incur capital expenditures to grow our business. Such limitations could negatively affect our business and operations prior to the closing of the Combination. The adverse effect of the pendency of the Combination could be exacerbated by any delays in completion of the Combination or by the termination of the Business Combination Agreement. Furthermore, the process of planning to integrate two businesses and organizations for the post-Combination period can divert management attention and resources and could ultimately have an adverse effect on Aon.

If completed, the Combinationmay not achieve its intended results.

We entered into the Business Combination Agreement with the expectation that the Combination would result in various benefits, including, among other things, synergies at the combined company, a comprehensive product portfolio, diversified growth profile and broad geographic reach. Achieving the anticipated benefits of the Combination is subject to a number of uncertainties, including whether our and WTW’s businesses can be integrated in an efficient and effective manner. Failure to achieve, a delay in achieving, or an increase in the costs to achieve, these anticipated benefits, in whole or in part, could result in increased costs or decreases in expected revenues and could adversely affect the combined company’s future business, financial condition, operating results and cash flows.

Aon and WTW may be unable to successfully integrate their operations. Failure to successfully integrate our and WTW’s businesses in the expected time frame may adversely affect the future results of the combined company.

The ability of Aon and WTW to realize the anticipated benefits of the Combination will depend, to a large extent, on the ability to integrate our and WTW’s business. The combination of two independent businesses is a complex, costly and time-consuming process. As a result, significant management attention and resources will be devoted to integrating the business practices and operations of Aon and WTW. The integration process may disrupt the businesses and, if implemented ineffectively, would preclude

realization of the full expected benefits. A failure to meet the challenges involved in integrating the two businesses and to realize the anticipated benefits of the Combination could adversely affect the combined company’s results of operations.

In addition, the overall integration of the businesses may result in material unanticipated problems, expenses, liabilities, competitive responses, loss of client relationships and diversion of management’s attention. The difficulties of combining the operations of the companies include, among others: the diversion of management attention to integration matters; difficulties in achieving anticipated cost savings, synergies, business opportunities and growth prospects from combining the businesses; difficulties in the integration of operations and systems; unanticipated costs, delays and other hardships to integration efforts, including any such ~~third parties.~~costs, delays or hardships, caused by pandemic, epidemic or outbreak of an infectious disease, including COVID-19 and the resulting travel and operations restrictions; difficulties in the assimilation of employees and culture; difficulties in managing the expanded operations of a larger and more complex company; challenges in retaining existing clients and obtaining new clients; and challenges in attracting and retaining key personnel.

Many of these factors will be outside of our and WTW’s control and any one of them could result in increased costs, decreases in expected revenues and diversion of management’s time and attention, which could materially impact the business, financial condition and results of operations of the combined company. In addition, even if the operations of the businesses of Aon and WTW are integrated successfully, the full benefits of the Combination, including the synergies, cost savings or sales or growth opportunities that are expected, may not be realized within the anticipated time frame or at all. Further, additional unanticipated costs may be incurred in the integration of the businesses of Aon and WTW. All of these factors could decrease or delay the expected accretive effect of the Combination and negatively impact the combined company’s results of operations.

We and WTW have incurred and will incur substantial transaction fees and costs in connection with the Combination.

We and WTW have incurred and expect to incur a number of non-recurring substantial transaction-related costs associated with the closing of the Combination, combining the operations of the two organizations and achieving desired synergies. These fees and costs will be substantial, and a portion of them will be incurred regardless of whether the Combination closes. Non-recurring transaction-related costs include, but are not limited to, fees paid to legal, financial and accounting advisors, retention, severance, change in control and other integration-related costs, filing fees and printing costs. Additional unanticipated costs may be incurred in connection with the closing and the integration of the businesses of Aon and WTW. There can be no assurance that the elimination of certain duplicative costs, as well as the realization of other efficiencies related to the integration of the two businesses, will offset the incremental transaction-related costs over time. Thus, any net benefit may not be achieved in the near term, the long term or at all, and these costs could adversely affect our financial conditions and results of operation prior, and of the combined company following, the closing of the Combination.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities.

The following information relates to the purchase of equity securities by Aon or any affiliated purchaser during each month within the ~~third~~first quarter of ~~2017:~~2020:

Period Total Number of Shares Purchased
Average Price Paid per Share ⁽¹⁾

Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs ⁽²⁾

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



Period	Total Number of Shares Purchased	Average Price Paid per Share ⁽¹⁾		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs ⁽²⁾	Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs ⁽¹⁾⁽²⁾
1/1/20 - 1/31/20	248,289	$	211.45	248,289	$	1,971,130,556
2/1/20 - 2/29/20	1,132,641	$	228.23	1,132,641	$	1,712,624,157
3/1/20 - 3/31/20	785,647	$	190.93	785,647	$	1,562,623,364
	2,166,577	$	212.78	2,166,577	$	1,562,623,364


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

(2)

The Repurchase Program was established in April 2012 with ~~up to~~ $5.0 billion in authorized repurchases, and was increased by $5.0 billion in authorized repurchases in each of November 2014 and ~~February~~June 2017 for a total of $15.0 billion in repurchase authorizations. ~~During the third quarter of 2017, we repurchased 5.4 million shares at an average price per share of $139.61 for a total cost of $749 million.~~Included in the 5.4 million shares repurchased was 165 thousand shares, which are included in the above table, that did not settle until October 2017. These shares were settled at an average price per share of $146.52 and total cost of $24.2 million.

We did not make any unregistered sales of equity in the ~~third~~first quarter of ~~2017.~~2020.

In connection with the Ireland Reorganization, the Class A ordinary shares of Aon UK were cancelled and the holders thereof were issued an aggregate of approximately 231 million Class A ordinary shares of Aon Ireland. The terms and conditions of the issuance were sanctioned by the High Court of Justice in England and Wales after a hearing upon the fairness thereof at which all shareholders of Aon UK had a right to appear and of which adequate notice had been given. The issuance was exempt from the registration requirements of the Securities Act of 1933, as amended, by virtue of Section 3(a)(10) thereof.

Item 3. Defaults Upon Senior Securities

Not Applicable.

Item 4. Mine Safety Disclosures

Not Applicable.

Item 5. Other Information

~~Not Applicable.~~Aon Corporation entered into a transition and separation agreement with Michael J. O’Connor, effective as of April 29, 2020, with respect to Mr. O’Connor’s transition on February 24, 2020 from the position of Co-President of the Company to the position of Special Advisor to the CEO, and with respect to his separation from the Company on February 28, 2021 (the “Separation Date”).

The agreement provides that Mr. O’Connor will continue to receive his current base salary until the Separation Date. In connection with Mr. O’Connor’s transition, and subject to customary conditions, he will receive a cash payment of $7,000,000, payable in installments, in exchange for carrying out duties and responsibilities prior to the Separation Date and for agreeing to certain non-competition obligations. Mr. O’Connor’s stock awards will be given normal treatment under the applicable plan documents, but will continue to vest on their original dates, notwithstanding his separation from employment on the Separation Date.

Item 6. Exhibits

Exhibits — The exhibits filed with this report are listed on the attached Exhibit Index.

Signature

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



	Aon plc
	(Registrant)

~~October 27, 2017~~May 1, 2020	By:	/s/ ~~Laurel Meissner~~Michael Neller
	~~LAUREL MEISSNER~~Michael Neller
	SENIOR VICE PRESIDENT AND
	GLOBAL CONTROLLER
	(Principal Accounting Officer and duly authorized officer of Registrant)

Exhibit Index



Exhibit Number		Description of Exhibit
~~12.1~~2.1		~~Statement regarding Computation of Ratio of Earnings~~Business Combination Agreement, dated March 9, 2020, between Aon plc (“Aon UK”) and Willis Towers Watson Public Limited Company (“WTW”) (incorporated by reference to ~~Fixed Charges.~~Exhibit 2.1 to Aon UK’s Current Report on Form 8-K filed on March 10, 2020).
~~31.1~~2.2		~~Certification of CEO.~~Appendix 3 to the Rule 2.5 Announcement, dated March 9, 2020 (incorporated by reference to Exhibit 2.2 to Aon UK’s Current Report on Form 8-K filed on March 10, 2020).
~~31.2~~2.3		~~Certification of CFO.~~Expenses Reimbursement Agreement, dated March 9, 2020, between Aon UK and WTW (incorporated by reference to Exhibit 2.3 to Aon UK’s Current Report on Form 8-K filed on March 10, 2020).
~~32.1~~2.4		Assignment Agreement, date April 2, 2020, between Aon Ireland and Aon UK (incorporated by reference to Exhibit 2.1 to Aon Ireland’s Current Report on Form 8-K filed on April 2, 2020).
3.1		Memorandum and Articles of Association of Aon plc (“Aon Ireland”) (incorporated by reference to Exhibit 3.1 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
4.1		Second Amended and Restated Indenture, dated April 1, 2020, among Aon Corporation, Aon UK, Aon Ireland, Aon Global Holdings Limited (“AGH”) and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”) (amending and restating the Amended and Restated Indenture, dated April 2, 2012, among Aon Corporation, Aon UK and the Trustee) (incorporated by reference to Exhibit 4.1 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
4.2		Second Amended and Restated Indenture, dated April 1, 2020, among Aon Corporation, Aon UK, Aon Ireland, AGH and the Trustee (amending and restating the Amended and Restated Indenture, dated April 2, 2012, among Aon Delaware, Aon UK and the Trustee) (incorporated by reference to Exhibit 4.2 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
4.3		Amended and Restated Indenture, dated April 1, 2020, among Aon UK, Aon Delaware, Aon Ireland, AGH and the Trustee (amending and restating the Indenture, dated December 12, 2012, among Aon UK, Aon Delaware and the Trustee) (incorporated by reference to Exhibit 4.3 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
4.4		Second Amended and Restated Indenture, dated April 1, 2020, among Aon UK, Aon Delaware, Aon Ireland, AGH and the Trustee (amending and restating the Amended and Restated Indenture, dated May 20, 2015, among Aon UK, Aon Delaware and the Trustee) (incorporated by reference to Exhibit 4.4 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
4.5		Amended and Restated Indenture, dated April 1, 2020, among Aon UK, Aon Delaware, Aon Ireland, AGH and the Trustee (amending and restating the Indenture, dated November 13, 2015, among Aon UK, Aon Delaware and the Trustee) (incorporated by reference to Exhibit 4.5 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
4.6		Amended and Restated Indenture, dated April 1, 2020, among Aon Delaware, Aon UK, Aon Ireland, AGH and the Trustee (amending and restating the Indenture, dated December 3, 2018, among Aon Delaware, Aon UK and the Trustee) (incorporated by reference to Exhibit 4.6 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
4.7		Description of securities of Aon Ireland that are registered under Section 12 of the Exchange Act (incorporated by reference to Exhibit 4.7 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
10.1		Deed of Assumption of Aon Ireland, dated April 1, 2020 ((incorporated by reference to Exhibit 10.1 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
10.2		Master Assignment, Assumption and Amendment Deed to Change in Control Arrangements, dated April 1, 2020, of Aon Ireland (incorporated by reference to Exhibit 10.2 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
10.3		Master Amendment to the Remaining Plans, dated April 1, 2020 of Aon Corporation (incorporated by reference to Exhibit 10.3 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
10.4		Form of Deed of Indemnity of Aon Ireland (incorporated by reference to Exhibit 10.4 to Aon Ireland’s Current Report on Form 8-K12B filed on April 1, 2020).
10.5		Form of Irrevocable Director Undertaking (incorporated by reference to Exhibit 10.1 to Aon plc’s Current Report on Form 8-K filed on March 10, 2020).
10.6*#		Consent to Shared-Sacrifice Reduction in Salary, dated April 23, 2020, by and between Aon plc and Greg Case.
10.7*#		Consent to Shared-Sacrifice Reduction in Salary, dated April 23, 2020, by and between Aon plc and Christa Davies.
10.8*#		Consent to Shared-Sacrifice Reduction in Salary, dated April 23, 2020, by and between Aon plc and Eric Andersen.
10.9*#		Consent to Shared-Sacrifice Reduction in Salary, dated April 23, 2020, by and between Aon plc and John Bruno.



10.10*		Waiver and Amendment No. 2 to the Five-Year Credit Agreement, dated April 1, 2020, among Aon UK, Aon Delaware, Aon UK Limited, the lenders party thereto and Citibank, N.A.
10.11*		Waiver and Amendment No. 1 to the Five-Year Credit Agreement, dated April 1, 2020, among Aon UK, Aon Delaware, the lenders party thereto and Citibank, N.A.
10.12*		Lender Assumption Agreement, dated February 27, 2020, among Aon plc, Citibank, N.A. and the other parties thereto, with respect to the Five-Year Credit Agreement, dated October 19, 2017, among Aon plc, Aon Corporation, Citibank N.A. and the other parties thereto.
10.13*#		Transition and Separation Agreement, dated April 30, 2020, by and between Michael J. O’Connor and Aon Corporation.
31.1*		Certification of CEO.
31.2*		Certification of CFO.
32.1*		Certification of CEO Pursuant to section 1350 of Title 18 of the United States Code.
~~32.2~~32.2*		Certification of CFO Pursuant to section 1350 of Title 18 of the United States Code.
~~101~~101*		Interactive Data Files. The following materials are filed electronically with this Quarterly Report on Form 10-Q:
		~~101.INS XBRL Report Instance Document~~
		101.SCH XBRL Taxonomy Extension Schema Document
		101.CAL XBRL Taxonomy Calculation Linkbase Document
		101.DEF XBRL Taxonomy Definition Linkbase Document
		101.PRE XBRL Taxonomy Presentation Linkbase Document
		101.LAB XBRL Taxonomy Calculation Linkbase Document
* Filed herewith
# Indicates a management contract or compensatory plan or arrangement

6658



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



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

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



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



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

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



	Three months ended September 30, 2017		Nine months ended September 30, 2017		Estimated Remaining Costs		Estimated Total Cost ⁽¹⁾
Workforce reduction	$	52	$	257	$	46	$	303
Technology rationalization ⁽²⁾	12		22		124		146
Lease consolidation ⁽²⁾	4		8		72		80
Asset impairments	2		26		14		40
Other costs associated with restructuring and separation ^{(2) (3)}	32		88		93		181
Total restructuring and related expenses	$	102	$	401	$	349	$	750



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



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



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



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



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



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



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



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



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

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

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



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

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

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

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



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