UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

	

FORM 8-K
 
CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
 
Date of report (Date of earliest event reported): February 10, 2017

	

 
Aon plc
(Exact Name of Registrant as Specified in Charter)

	
					
England and Wales	 	1-7933	 	98-1030901	
(State or Other Jurisdiction
of Incorporation)	 	(Commission File Number)	 	(IRS Employer
Identification No.)	

	
			
122 Leadenhall Street, London, England
 (Address of Principal Executive Offices)	 	EC3V 4AN
 (Zip Code)	
 
Registrant’s telephone number, including area code: +44 20 7623 5500
 
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see General Instruction A.2. below):
 
o     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
o     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
o     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

	

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Item 2.02.             Results of Operations and Financial Condition.
 
On February 10, 2017 , Aon plc issued a press release (the “Press Release”) announcing its results of operations for the quarter and year ended December 31, 2016 .
 
A copy of the Press Release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
 
Item 9.01.             Financial Statements and Exhibits.
 
(a) - (c)   Not applicable.
 
(d)           Exhibits:

				
 	Exhibit
Number	 	Description of
  Exhibit	
 	99.1	 	Press Release issued by Aon plc on February 10, 2017.	

2

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

	
				
 	 	Aon plc	
 	 	 	
 	 	By:	/s/ Christa Davies	
 	 	 	Christa Davies	
 	 	 	Executive Vice President and Chief Financial Officer	
 	 	 	
Date:	February 10, 2017	 	

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EXHIBIT INDEX

	
			
Exhibit
Number	 	Description of
  Exhibit	
99.1	 	Press Release issued by Aon plc on February 10, 2017.	

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Exhibit 99.1

		
Investor Relations		
 
News from Aon
 
Aon Reports Fourth Quarter and Full Year 2016 Results
 
Fourth Quarter Key Metrics and Highlights 1  
		
•	Total revenue was $3.3 billion with organic revenue growth of 3%	
		
•	Operating margin decreased 290 basis points to 18.9% , and operating margin, adjusted for certain items, increased 210 basis points to 26.2%	
		
•	EPS decreased 11% to $1.87 , and EPS, adjusted for certain items, increased 13% to $2.56	
		
•	The Company closed its acquisition of Stroz Friedberg, strengthening its ability to serve clients as the global leader in cyber risk mitigation	
		
•	The Company closed its acquisition of Admix, a leading health and benefits brokerage firm in Brazil	
		
•	Repurchased 1.8 million Class A Ordinary Shares for approximately $200 million	

Full Year Key Metrics and Highlights
		
•	Total revenue was $11.6 billion with organic revenue growth of 3%	
		
•	Operating margin increased 60 basis points to 16.4% , and operating margin, adjusted for certain items, increased 80 basis points to 20.8%	
		
•	EPS increased 6% to $5.16 , and EPS, adjusted for certain items, increased 7% to $6.59	
		
•	Cash flow from operations increased 16% to a record $2.3 billion , and free cash flow increased 22% to a record $2.1 billion	
		
•	Repurchased 12.2 million Class A Ordinary Shares for approximately $1.3 billion	
		
•	Subsequent to the close of the fourth quarter, the Company signed a definitive agreement to sell the Benefits Administration and HR Business Process Outsourcing businesses for gross cash proceeds up to $4.8 billion, including $4.3 billion in gross cash at closing and additional consideration up to $500 million based on future performance. Total after-tax cash proceeds are expected to be approximately $3.0 billion.	
 
LONDON - February 10, 2017 - Aon plc (NYSE: AON) today reported results for the three and twelve months ended December 31, 2016 .
  
Net income attributable to Aon shareholders was $502 million , or $1.87 per share, compared to $584 million , or $2.09 per share, for the prior year quarter. Net income per share attributable to Aon shareholders, adjusted for certain items, increased 13% to $2.56 , compared to $2.27 in the prior year quarter. Certain items that impacted fourth quarter results and comparisons with the prior year quarter are detailed in the “Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings per Share” on page 13 of this press release.

“We ended 2016 in a strong position, driving positive performance across each of our key metrics for both the fourth quarter and the full year, highlighted by growth across every major business and record operating margin in Risk Solutions,” said Greg Case, President and Chief Executive Officer. “Substantial investments in high-growth areas of our industry-leading platform, improved operational performance, and record free cash flow generation of more than $2.1 billion, continue to position the firm for increased shareholder value creation over the long-term.”

1 Refer to "Revision of Previously Issued Financial Statements" as disclosed in the schedules on pages 16 and 17.

FOURTH QUARTER FINANCIAL SUMMARY
 
Total revenue in the fourth quarter increased 1% to $3.3 billion compared to the prior year quarter driven primarily by 3% organic revenue growth, partially offset by a 2% unfavorable impact from foreign currency translation.

Total operating expenses for the fourth quarter increased 5% to $2.7 billion compared to the prior year quarter due primarily to $158 million of non-cash expenses related to certain pension settlements, $15 million of transaction costs related to the pending sale of certain assets, $6 million of transaction costs related to acquisitions, and an increase in expense to support 3% organic revenue growth, partially offset by a $67 million favorable impact from foreign currency translation, a $10 million decrease in the core expense base related to divested businesses, net of acquisitions, and a $7 million decrease in intangible asset amortization.

Depreciation expense increased 2% , or $1 million , in the fourth quarter to $61 million compared to the prior year quarter.

Intangible asset amortization expense decreased 9% , or $7 million , in the fourth quarter to $70 million compared to the prior year quarter, consisting of a $9 million decrease in HR Solutions and a $2 million increase in Risk Solutions.

Foreign currency exchange rates in the fourth quarter had a $0.04 per share, or $13 million pretax, favorable impact (+$13 million in Risk Solutions, -$6 million in HR Solutions, and +$6 million Unallocated) on GAAP net income and a $0.03 per share, or $10 million pretax, favorable impact (+$12 million in Risk Solutions, -$8 million in HR Solutions, and +$6 million Unallocated) on adjusted net income if the Company were to translate prior year quarter results at current quarter foreign exchange rates.

Effective tax rate used in the U.S. GAAP financial statements for the fourth quarter was 10.9% , compared to the prior year quarter of 15.8% . After adjusting to exclude the applicable tax impact associated with certain non-cash pension expenses, the adjusted effective tax rate for the fourth quarter of 2016 was 14.9% compared to 17.9% in the prior year quarter, due primarily to changes in the geographic distribution of income and certain favorable discrete tax adjustments. The prior year quarter adjusted effective tax rate excludes the applicable tax impact associated with expenses related to certain legacy litigation. These adjustments are discussed in the "Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings per Share" on page 13 of this press release.

Average diluted shares outstanding decreased 4% to 268.3 million in the fourth quarter compared to 279.3 million in the prior year quarter. The Company repurchased 1.8 million Class A Ordinary Shares for approximately $200 million in the fourth quarter. As of December 31, 2016, the Company had $2.8 billion of remaining authorization under its share repurchase program. Subsequent to the close of the fourth quarter, the Board of Directors authorized a $5.0 billion increase to the existing remaining authorization under its share repurchase program. As of February 10, 2017, the Company has approximately $7.7 billion of remaining authorization under its share repurchase program.

Cash flow from operations for 2016 increased 16% , or $317 million , compared to the prior year to a record $2.3 billion driven by an increase in underlying net income after adjusting for certain non-cash pension expenses, lower cash pension contributions, and lower cash tax payments.

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Free cash flow , defined as cash flow from operations less capital expenditures, increased 22% , or $385 million , compared to the prior year to a record $2.1 billion for 2016, driven by an increase in cash flow from operations and a $68 million decrease in capital expenditures. A reconciliation of free cash flow to cash flow from operations can be found on the “Reconciliation of Non-GAAP Measures - Organic Revenue and Free Cash Flow” on page 12 of this press release.

FOURTH QUARTER SEGMENT REVIEW 1  
 
Certain noteworthy items impacted operating income and operating margins in the fourth quarters of 2016 and 2015 . The fourth quarter segment information provided below includes supplemental information related to organic revenue, adjusted operating income and adjusted operating margin, which is described in detail on the “Reconciliation of Non-GAAP Measures - Organic Revenue and Free Cash Flow” on page 12 and “Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings per Share” on page 13 of this press release.
 
RISK SOLUTIONS

																					
 	 	 	 	 	 	 	 	 	 	Less:	 	 	
(millions)	 	Three Months Ended	 	 	 	Less:	 	Acquisitions,	 	 	
Commissions,
Fees and Other	 	December 31, 2016	 	December 31,
2015	 	%
Change	 	Currency
Impact	 	Divestitures,
Other	 	Organic
Revenue	
Retail	 	$	1,716		 	$	1,681		 	2	%	 	(2	)%	 	1	%	 	3	%	
Reinsurance	 	329		 	323		 	2		 	—		 	—		 	2		
Subtotal	 	$	2,045		 	$	2,004		 	2	%	 	(1	)%	 	—	%	 	3	%	
Investment Income	 	6		 	5		 	20		 	 	 	 	 	 	
Total Revenue	 	$	2,051		 	$	2,009		 	2	%	 	 	 	 	 	 	

Risk Solutions total revenue for the fourth quarter increased 2% compared to the prior year quarter driven by 3% organic growth in commissions and fees, partially offset by a 1% unfavorable impact from foreign currency translation. The Company has identified certain immaterial legacy errors related to the quarterly timing of revenue recognition within the Americas Retail brokerage business in Risk Solutions that affected quarterly revenue amounts previously reported as discussed in the “Revision of Previously Issued Financial Statements” on pages 16 and 17 of this press release. The impact of the errors on the Company’s annual revenue and organic growth is immaterial.

Retail organic revenue for the fourth quarter increased 3% reflecting revenue growth in both the Americas and International businesses. Americas organic revenue increased 3% reflecting strong growth in Affinity and in Latin America as well as continued record new business generation in US Retail. International organic revenue increased 2% driven by growth across every major region, highlighted by double-digit growth in Health and Benefits brokerage across Asia and EMEA, and overall strength across the Pacific driven by strong new business generation.
 
Reinsurance organic revenue for the fourth quarter increased 2% compared to the prior year quarter driven by new business generation in treaty and growth in facultative placements, partially offset by a decline in capital markets transactions and advisory business, as well as a modest unfavorable market impact globally.

1 Refer to "Revision of Previously Issued Financial Statements" as disclosed in the schedules on pages 16 and 17.

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 	 	Three Months Ended	 	 	
(millions)	 	December 31,
2016	 	December 31,
2015	 	%
  Change	
Revenue	 	$	2,051		 	$	2,009		 	2	 %	
Expenses	 	 	 	 	 	 	
Compensation and benefits	 	1,190		 	1,130		 	5		
Other general expenses	 	406		 	388		 	5		
Total operating expenses	 	1,596		 	1,518		 	5		
Operating income	 	$	455		 	$	491		 	(7	)%	
Operating margin	 	22.2	%	 	24.4	%	 	 	
Operating income - adjusted	 	$	566		 	$	517		 	9	 %	
Operating margin - adjusted	 	27.6	%	 	25.7	%	 	 	

Compensation and benefits for the fourth quarter increased 5% , or $60 million , compared to the prior year quarter due primarily to $83 million of non-cash expenses related to certain pension settlements and a $20 million increase in the core expense base related to acquired businesses, net of divestitures, partially offset by a $26 million favorable impact from foreign currency translation, and expense discipline.

Other general expenses for the fourth quarter increased 5% , or $18 million , compared to the prior year quarter due primarily to an increase in expense to support 3% organic revenue growth, a $12 million increase in the core expense base related to acquired businesses, net of divestitures, $6 million of transaction costs related to acquisitions, and a $2 million increase in intangible asset amortization, partially offset by a $15 million favorable impact from foreign currency translation.
 
Fourth quarter operating income decreased 7% to $455 million compared to the prior year quarter. Adjusting for certain items detailed on page 13 of this press release, operating income increased 9% , or $49 million , and operating margin increased 190 basis points to 27.6% , each compared to the prior year quarter. The increase in adjusted operating margin was driven primarily by organic revenue growth of 3% , return on investments in data and analytics across the portfolio, and a 100 basis point favorable impact from foreign currency translation, partially offset by $6 million, or -30 basis points, of transaction costs related to acquisitions.

  HR SOLUTIONS

																					
(millions)	 	Three Months Ended	 	 	 	Less:	 	Less:
Acquisitions,	 	 	
Commissions,
Fees and Other	 	December 31,
2016	 	December 31,
2015	 	%
Change	 	Currency
Impact	 	Divestitures,
Other	 	Organic
Revenue	
Consulting Services	 	$	446		 	$	464		 	(4	)%	 	(4	)%	 	—	 %	 	—	%	
Outsourcing	 	854		 	839		 	2		 	(1	)	 	(5	)	 	8		
Intersegment	 	(19	)	 	(13	)	 	N/A		 	N/A		 	N/A		 	N/A		
Subtotal	 	$	1,281		 	$	1,290		 	(1	)%	 	(2	)%	 	(4	)%	 	5	%	
Investment Income	 	—		 	—		 	—	 %	 	 	 	 	 	 	
Total Revenue	 	$	1,281		 	$	1,290		 	(1	)%	 	 	 	 	 	 	

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HR Solutions total revenue for the fourth quarter decreased 1% to $1.3 billion compared to the prior year quarter driven by a 4% decrease in commissions and fees related to net divestitures and a 2% unfavorable impact from foreign currency translation, partially offset by 5% organic growth in commissions and fees.

Organic revenue in Consulting Services was flat as continued growth in retirement solutions, particularly for investment consulting was offset by a decline in project-related work from the prior year quarter and a modest decline in talent and compensation consulting. Organic revenue in Outsourcing increased 8% compared to the prior year quarter due primarily to strong double-digit growth in health care exchanges and continued strength in HR BPO for cloud-based solutions, partially offset by an anticipated modest decline in benefits administration.

												
 	 	Three Months Ended	 	 	
(millions)	 	December 31,
2016	 	December 31,
2015	 	%
Change	
Revenue	 	$	1,281		 	$	1,290		 	(1	)%	
Expenses	 	 	 	 	 	 	
Compensation and benefits	 	683		 	687		 	(1	)	
Other general expenses	 	317		 	316		 	—		
Total operating expenses	 	1,000		 	1,003		 	—		
Operating income	 	$	281		 	$	287		 	(2	)%	
Operating margin	 	21.9	%	 	22.2	%	 	 	
Operating income - adjusted	 	$	363		 	$	338		 	7	 %	
Operating margin - adjusted	 	28.3	%	 	26.2	%	 	 	

Compensation and benefits for the fourth quarter decreased $4 million compared to the prior year quarter due primarily to a $34 million decrease in the core expense base related to divested businesses, net of acquisitions, and a $12 million favorable impact from currency translation, partially offset by an increase in expense associated with 5% organic revenue growth and $25 million of non-cash expenses related to certain pension settlements.

Other general expenses for the fourth quarter increased $1 million compared to the prior year quarter due primarily to an increase in expense to support 5% organic growth and $15 million of transaction costs related to the pending sale of certain assets, partially offset by a $9 million decrease in intangible asset amortization, an $8 million decrease in the core expense base related to divested businesses, net of acquisitions, a $7 million favorable impact from foreign currency translation, and expense discipline.

Fourth quarter operating income decreased 2% to $281 million compared to the prior year quarter. Adjusting for certain items detailed on page 13 of this press release, operating income increased 7% , or $25 million , and operating margin increased 210 basis points to 28.3% , each compared to the prior year quarter. The increase in adjusted operating margin was primarily driven by solid organic revenue growth of 5% and expense discipline, partially offset by an $8 million, or -10 basis point, unfavorable impact from foreign currency translation.

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INCOME BEFORE INCOME TAXES 1

												
 	 	Three Months Ended	 	 	
(millions)	 	December 31,
2016	 	December 31,
2015	 	%
Change	
Risk Solutions	 	$	455		 	$	491		 	(7	)%	
HR Solutions	 	281		 	287		 	(2	)	
Unallocated expense	 	(107	)	 	(61	)	 	75		
Operating income	 	$	629		 	$	717		 	(12	)%	
Interest income	 	3		 	4		 	(25	)	
Interest expense	 	(70	)	 	(68	)	 	3		
Other income	 	9		 	49		 	(82	)	
Income before income taxes	 	$	571		 	$	702		 	(19	)%	
 
Unallocated expense for the fourth quarter increased $46 million to $107 million compared to the prior year quarter primarily due to $50 million of non-cash expenses related to certain pension settlements. Interest income decreased $1 million to $3 million compared to the prior year quarter. Interest expense increased $2 million to $70 million compared to the prior year quarter due primarily to an increase in total debt outstanding. Other income of $9 million primarily includes net gains due to the favorable impact of exchange rates on the remeasurement of monetary assets and liabilities in non-functional currencies. The prior year quarter primarily includes net gains on the sale of a certain business, partially offset by the unfavorable impact of exchange rates on the remeasurement of monetary assets and liabilities in non-functional currencies.

2016 FULL YEAR SUMMARY

Total revenue for 2016 was $11.6 billion due to a 2% decrease in commissions and fees related to divestitures, net of acquisitions, and a 2% unfavorable impact from foreign currency translation, each compared to the prior year, partially offset by 3% organic growth in commissions and fees. Risk Solutions total revenue increased 1% to $7.5 billion and HR Solutions total revenue decreased 3% to $4.2 billion .

Net income attributable to Aon shareholders for 2016 increased 1% to $1.4 billion compared to the prior year. Net income attributable to Aon shareholders, adjusted for certain items, increased 2% to $1.8 billion . Certain items that impacted full year results and comparisons against the prior year are detailed in the “Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings per Share” on page 13 of this press release.
Net income per share attributable to Aon shareholders for 2016 increased 6% to $5.16 per share compared to $4.88 per share for the prior year. Net income attributable to Aon shareholders, adjusted for certain items, increased 7% to $6.59 per share compared to $6.18 per share for the prior year. The prior year included $100 million of other income, primarily reflecting the sale of certain businesses and foreign currency gains, which was a $64 million, or $0.19 per share, net benefit when comparing to $36 million of other income in 2016. Certain items that impacted full year results and comparisons against the prior year are detailed in the “Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings per Share” on page 13 of this press release.

During 2016, the Company repurchased approximately 12.2 million Class A Ordinary Shares for $1.3 billion at an average price of $102.66 per share.

1 Refer to "Revision of Previously Issued Financial Statements" as disclosed in the schedules on pages 16 and 17.

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Conference Call, Presentation Slides and Webcast Details
The Company will host a conference call on Friday, February 10, 2017 at 7:30 a.m., central time. Interested parties can listen to the conference call via a live audio webcast and view the presentation slides at www.aon.com.

  About Aon
Aon plc   (NYSE:AON) is a leading global provider of   risk management , insurance brokerage and   reinsurance   brokerage, and   human resources  solutions and   outsourcing   services. Through its more than 72,000 colleagues worldwide, Aon unites to empower results for clients in over 120 countries via innovative risk and people solutions.   For further information on our capabilities and to learn how we empower results for clients, please visit:  http://aon.mediaroom.com.
Safe Harbor Statement
This communication contain certain statements related to future results, or states 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 words such as "anticipate," "believe," "estimate," "expect," "forecast," "project," "intend," "plan," "probably," "potential," "looking forward" and other similar terms, and future or conditional tense verbs like "could," "may," "might," "should," "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; 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 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; and the impact of changes in accounting rules. These 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.

The following factors, among others, could cause actual results to differ from those set forth in the forward looking statements:  general economic and political conditions in different countries in which Aon does business around the world; changes in the competitive environment; fluctuations in exchange and interest rates that could influence revenue and expense; changes in global equity and fixed income markets that could affect the return on invested assets; changes in the funding status of Aon's various defined benefit pension plans and the impact of any increased pension funding resulting from those changes; the level of Aon’s debt limiting financial flexibility; rating agency actions that could affect Aon's ability to borrow funds; the effect of the change in global headquarters and jurisdiction of incorporation, including differences in the anticipated benefits; changes in estimates or assumptions on our financial statements; limits on Aon’s subsidiaries to make dividend and other payments to Aon; the impact of lawsuits and other contingent liabilities and loss contingencies arising from errors and omissions and other claims against Aon; the impact of, and potential challenges in complying with, legislation and regulation in the jurisdictions in which Aon operates, particularly given the global scope of Aon’s  businesses and the possibility of conflicting regulatory requirements across jurisdictions in which Aon does business; the impact of any investigations brought by regulatory authorities in 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 law on our operating flexibility and the enforcement of judgments against Aon; the failure to retain and attract qualified personnel; international risks associated with Aon’s global operations; the effect or natural or man-made disasters; the potential of a system or network breach or disruption resulting in operational interruption or improper disclosure of personal data; Aon’s ability to develop and implement new technology; the damage to our reputation among clients, markets or third parties; the actions taken by third parties that preform aspects of our business operations and client services;  the extent to which Aon manages certain risks created in connection with the various services, including fiduciary and investments and other advisory services and business process outsourcing services, among others, that Aon currently provides, or will provide in the future, to clients; Aon’s ability to grow, develop and integrate companies that it acquires 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; and Aon’s ability to implement initiatives intended to yield cost savings, and the ability to achieve those cost savings.

Any or all of Aon’s forward-looking statements may turn out to be inaccurate, and there are no guarantees about Aon’s performance.  The factors identified above are not exhaustive.  Aon and its subsidiaries operate in a dynamic business environment in which new risks may emerge frequently.  Further information concerning Aon and its businesses, including factors that potentially could

7

materially affect Aon's financial results, is contained in Aon's filings with the SEC. See Aon’s Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q for a further discussion of these and other risks and uncertainties applicable to Aon’s businesses. These factors may be revised or supplemented in subsequent reports.  Aon is under no obligation, and expressly disclaims any obligation, to update or alter any forward-looking statement that it may make from time to time, whether as a result of new information, future events or otherwise.

Explanation of Non-GAAP Measures
This communication includes supplemental information related to organic revenue, free cash flow, adjusted operating margin, adjusted earnings per share, and adjusted effective tax rate that exclude the effects of intangible asset amortization, capital expenditures, transaction costs and certain other noteworthy items that affected results for the comparable periods.  Organic revenue excludes from reported revenues the impact of foreign exchange, acquisitions, divestitures, transfers between business units, reimbursable expenses and unusual items.  The impact of foreign exchange is determined by translating last year's revenue, expense or net income at this year's foreign exchange rates.  Reconciliations are provided in the attached schedules.  Supplemental organic revenue information and additional measures that exclude the effects of the restructuring charges and certain other items do not affect net income or any other GAAP reported amounts.  Free cash flow is cash flow from operating activity less capital expenditures. The effective tax rate, as adjusted, excludes the applicable tax impact associated with expenses for legacy litigation. Management believes that these measures are important to make meaningful period-to-period comparisons and that this supplemental information is helpful to investors.  They should be viewed in addition to, not in lieu of, the Company’s Consolidated Financial Statements.  Industry peers provide similar supplemental information regarding their performance, although they may not make identical adjustments.

#

			
Investor Contact:	 	Media Contact:	
Scott Malchow	 	Donna Mirandola	
Senior Vice President, Investor Relations	 	Senior Director, External Communications - Americas	
+44 (0) 20 7086 0100	 	+1 312-381-1532	

8

Aon plc
Consolidated Statements of Income (Unaudited)

	
																							
 	 	Three Months Ended	 	Twelve Months Ended	
(millions, except per share data)	 	December 31,
2016	 	December 31,
2015	 	Percent
Change	 	December 31,
2016	 	December 31,
2015	 	Percent
Change	
Revenue	 	 		 	 		 	 	 	 		 	 		 	 	
Commissions, fees and other	 	$	3,317		 	$	3,283		 	1	 %	 	$	11,605		 	$	11,661		 	—	 %	
Fiduciary investment income	 	6		 	5		 	20		 	22		 	21		 	5		
Total revenue	 	3,323		 	3,288		 	1		 	11,627		 	11,682		 	—		
Expenses	 	 	 	 	 	 		 	 		 	 		 	 		
Compensation and benefits	 	1,966		 	1,857		 	6		 	6,914		 	6,837		 	1		
Other general expenses	 	728		 	714		 	2		 	2,807		 	2,997		 	(6	)	
Total operating expenses	 	2,694		 	2,571		 	5		 	9,721		 	9,834		 	(1	)	
Operating income	 	629		 	717		 	(12	)	 	1,906		 	1,848		 	3		
Interest income	 	3		 	4		 	(25	)	 	9		 	14		 	(36	)	
Interest expense	 	(70	)	 	(68	)	 	3		 	(282	)	 	(273	)	 	3		
Other income	 	9		 	49		 	(82	)	 	36		 	100		 	(64	)	
Income before income taxes	 	571		 	702		 	(19	)	 	1,669		 	1,689		 	(1	)	
Income taxes	 	62		 	112		 	(45	)	 	239		 	267		 	(10	)	
Net income	 	509		 	590		 	(14	)	 	1,430		 	1,422		 	1		
Less: Net income attributable to noncontrolling interests	 	7		 	6		 	17		 	34		 	37		 	(8	)	
Net income attributable to Aon shareholders	 	$	502		 	$	584		 	(14	)%	 	$	1,396		 	$	1,385		 	1	 %	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic net income per share attributable to Aon shareholders	 	$	1.89		 	$	2.12		 	(11	)%	 	$	5.21		 	$	4.93		 	6	 %	
Diluted net income per share attributable to Aon shareholders	 	$	1.87		 	$	2.09		 	(11	)	 	$	5.16		 	$	4.88		 	6		
Weighted average ordinary shares outstanding - diluted	 	268.3		 	279.3		 	(4	)%	 	270.3		 	283.8		 	(5	)%	
 
(1)   The effective tax rate is 10.9% and 15.8% for the three months ended December 31, 2016 and 2015 , respectively, and 14.3% and 15.8% for the twelve months ended December 31, 2016 and 2015 , respectively.

9

Aon plc
Revenue (Unaudited)

																													
 	 	Three Months Ended	 	Twelve Months Ended	
(millions)	 	Dec 31,
2016	 	Dec 31,
2015	 	Percent
Change	 	Organic
Revenue
Growth (1)	 	Dec 31,
2016	 	Dec 31,
2015	 	Percent
Change	 	Organic
Revenue
Growth (1)	
Commissions, Fees and Other	 	 		 	 		 	 		 	 		 	 		 	 		 	 		 	 		
Risk Solutions	 	$	2,045		 	$	2,004		 	2	 %	 	3	%	 	$	7,463		 	$	7,405		 	1	 %	 	3	%	
HR Solutions	 	1,281		 	1,290		 	(1	)	 	5		 	4,183		 	4,303		 	(3	)	 	3		
Total Operating Segments	 	$	3,326		 	$	3,294		 	1	 %	 	3	%	 	$	11,646		 	$	11,708		 	(1	)%	 	3	%	
Fiduciary Investment Income	 	 		 	 		 	 		 	 		 	 		 	 		 	 		 	 		
Risk Solutions	 	$	6		 	$	5		 	20	 %	 	 		 	$	22		 	$	21		 	5	 %	 	 		
HR Solutions	 	—		 	—		 	—		 	 		 	—		 	—		 	—		 	 		
Total Operating Segments	 	$	6		 	$	5		 	20	 %	 	 		 	$	22		 	$	21		 	5	 %	 	 		
Total Revenue	 	 		 	 		 	 		 	 		 	 		 	 		 	 		 	 		
Risk Solutions	 	$	2,051		 	$	2,009		 	2	 %	 	 		 	$	7,485		 	$	7,426		 	1	 %	 	 		
HR Solutions	 	1,281		 	1,290		 	(1	)	 	 		 	4,183		 	4,303		 	(3	)	 	 		
Intersegment	 	(9	)	 	(11	)	 	(18	)	 	 		 	(41	)	 	(47	)	 	(13	)	 	 		
Total	 	$	3,323		 	$	3,288		 	1	 %	 	 		 	$	11,627		 	$	11,682		 	—	 %	 	 		
 
(1)          Organic revenue excludes the impact of foreign exchange, acquisitions, divestitures, transfers, reimbursable expenses and unusual items. Change in organic revenue, a non-GAAP measure, is reconciled to the corresponding U.S. GAAP percent change in revenue on page 12 of this release.

10

Aon plc
Segments (Unaudited)
 
Risk Solutions

																							
 	 	Three Months Ended	 	Twelve Months Ended	
(millions)	 	Dec 31,
2016	 	Dec 31,
2015	 	Percent Change	 	Dec 31,
2016	 	Dec 31,
2015	 	Percent Change	
Revenue	 	 		 	 		 	 		 	 		 	 		 	 		
Commissions, fees and other	 	$	2,045		 	$	2,004		 	2	 %	 	$	7,463		 	$	7,405		 	1	 %	
Fiduciary investment income	 	6		 	5		 	20		 	22		 	21		 	5		
Total revenue	 	2,051		 	2,009		 	2		 	7,485		 	7,426		 	1		
Expenses	 	 	 	 	 	 	 	 	 	 	 	 	
Compensation and benefits	 	1,190		 	1,130		 	5		 	4,305		 	4,180		 	3		
Other general expenses	 	406		 	388		 	5		 	1,593		 	1,740		 	(8	)	
Total operating expenses	 	1,596		 	1,518		 	5		 	5,898		 	5,920		 	—		
Operating income	 	$	455		 	$	491		 	(7	)%	 	$	1,587		 	$	1,506		 	5	 %	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating margin	 	22.2	%	 	24.4	%	 	 	 	21.2	%	 	20.3	%	 	 	

HR Solutions

																							
 	 	Three Months Ended	 	Twelve Months Ended	
(millions)	 	Dec 31,
2016	 	Dec 31,
2015	 	Percent Change	 	Dec 31,
2016	 	Dec 31,
2015	 	Percent Change	
Revenue	 	 		 	 		 	 		 	 		 	 		 	 		
Commissions, fees and other	 	$	1,281		 	$	1,290		 	(1	)%	 	$	4,183		 	$	4,303		 	(3	)%	
Fiduciary investment income	 	—		 	—		 	N/A		 	—		 	—		 	N/A		
Total revenue	 	1,281		 	1,290		 	(1	)	 	4,183		 	4,303		 	(3	)	
Expenses	 	 	 	 	 	 	 	 	 	 	 	 	
Compensation and benefits	 	683		 	687		 	(1	)	 	2,437		 	2,547		 	(4	)	
Other general expenses	 	317		 	316		 	—		 	1,189		 	1,220		 	(3	)	
Total operating expenses	 	1,000		 	1,003		 	—		 	3,626		 	3,767		 	(4	)	
Operating income	 	$	281		 	$	287		 	(2	)%	 	$	557		 	$	536		 	4	 %	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating margin	 	21.9	%	 	22.2	%	 	 	 	13.3	%	 	12.5	%	 	 	
 
Total Operating Income (Loss)

																							
 	 	Three Months Ended	 	Twelve Months Ended	
(millions)	 	Dec 31,
2016	 	Dec 31,
2015	 	Percent Change	 	Dec 31,
2016	 	Dec 31,
2015	 	Percent Change	
Risk Solutions	 	$	455		 	$	491		 	(7	)%	 	$	1,587		 	$	1,506		 	5	%	
HR Solutions	 	281		 	287		 	(2	)	 	557		 	536		 	4		
Unallocated expense	 	(107	)	 	(61	)	 	75		 	(238	)	 	(194	)	 	23		
Total operating income	 	$	629		 	$	717		 	(12	)%	 	$	1,906		 	$	1,848		 	3	%	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Total operating margin	 	18.9	%	 	21.8	%	 	 	 	16.4	%	 	15.8	%	 	 	

11

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Reconciliation of Non-GAAP Measures - Organic Revenue and Free Cash Flow (Unaudited)
 
Organic Revenue (Unaudited)

																					
 	 	Three Months Ended	
(millions)	 	December 31,
2016	 	December 31,
2015	 	Percent
Change	 	Less:
Currency
Impact (1)	 	Less: Acquisitions,
Divestitures & Other	 	Organic
Revenue
Growth (2)	
Commissions, Fees and Other	 	 		 	 		 	 		 	 		 	 		 	 		
Risk Solutions Segment:	 	 		 	 		 	 		 	 		 	 		 	 		
Retail brokerage	 	 		 	 		 	 		 	 		 	 		 	 		
Americas	 	$	1,005		 	$	965		 	4	 %	 	(1	)%	 	2	 %	 	3	%	
International	 	711		 	716		 	(1	)	 	(3	)	 	—		 	2		
Total Retail brokerage	 	1,716		 	1,681		 	2		 	(2	)	 	1		 	3		
Reinsurance brokerage	 	329		 	323		 	2		 	—		 	—		 	2		
Total Risk Solutions	 	2,045		 	2,004		 	2		 	(1	)	 	—		 	3		
HR Solutions Segment:	 	 	 	 	 	 	 	 	 	 	 	 	
Consulting services	 	446		 	464		 	(4	)	 	(4	)	 	—		 	—		
Outsourcing	 	854		 	839		 	2		 	(1	)	 	(5	)	 	8		
Intrasegment	 	(19	)	 	(13	)	 	N/A		 	N/A		 	N/A		 	N/A		
Total HR Solutions	 	1,281		 	1,290		 	(1	)	 	(2	)	 	(4	)	 	5		
Total Operating Segments	 	$	3,326		 	$	3,294		 	1	 %	 	(2	)%	 	—	 %	 	3	%	

																					
 	 	Twelve Months Ended	
(millions)	 	December 31,
2016	 	December 31,
2015	 	Percent
Change	 	Less:
Currency
Impact (1)	 	Less: Acquisitions,
Divestitures & Other	 	Organic
Revenue
Growth (2)	
Commissions, Fees and Other	 	 		 	 		 	 		 	 		 	 		 	 		
Risk Solutions Segment:	 	 		 	 		 	 		 	 		 	 		 	 		
Retail brokerage	 	 		 	 		 	 		 	 		 	 		 	 		
Americas	 	$	3,357		 	$	3,294		 	2	 %	 	(2	)%	 	—	 %	 	4	%	
International	 	2,739		 	2,750		 	—		 	(3	)	 	—		 	3		
Total Retail brokerage	 	6,096		 	6,044		 	1		 	(3	)	 	—		 	4		
Reinsurance brokerage	 	1,367		 	1,361		 	—		 	(1	)	 	—		 	1		
Total Risk Solutions	 	7,463		 	7,405		 	1		 	(2	)	 	—		 	3		
HR Solutions Segment:	 	 	 	 	 	 	 	 	 	 	 	 	
Consulting services	 	1,662		 	1,686		 	(1	)	 	(3	)	 	—		 	2		
Outsourcing	 	2,557		 	2,658		 	(4	)	 	(1	)	 	(7	)	 	4		
Intrasegment	 	(36	)	 	(41	)	 	N/A		 	N/A		 	N/A		 	N/A		
Total HR Solutions	 	4,183		 	4,303		 	(3	)	 	(2	)	 	(4	)	 	3		
Total Operating Segments	 	$	11,646		 	$	11,708		 	(1	)%	 	(2	)%	 	(2	)%	 	3	%	
 
Free Cash Flow (Unaudited)

												
 	 	Twelve Months Ended	
(millions)	 	December 31,
2016	 	December 31,
2015	 	Percent Change	
Cash Provided By Operating Activities	 	$	2,326		 	$	2,009		 	16	 %	
Less: Capital Expenditures	 	(222	)	 	(290	)	 	(23	)	
Free Cash Flow (3)	 	$	2,104		 	$	1,719		 	22	 %	
 
(1)   Currency impact is determined by translating last year's revenue at this year's foreign exchange rates.
(2)   Organic revenue excludes the impact of foreign exchange, acquisitions, divestitures, transfers, reimbursable expenses and unusual items.
(3)   Free cash flow is defined as cash flow from operations less capital expenditures. This non-GAAP measure does not imply or represent a precise calculation of residual cash flow available for discretionary expenditures.

12

Aon plc
Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings Per Share (Unaudited) (1)

																																	
 	 	Three Months Ended December 31, 2016	 	Twelve Months Ended December 31, 2016	
(millions)	 	Risk
Solutions	 	HR
Solutions	 	Unallocated
Income &
Expense	 	Total	 	Risk
Solutions	 	HR
Solutions	 	Unallocated
Income &
Expense	 	Total	
Revenue	 	$	2,051		 	$	1,281		 	$	(9	)	 	$	3,323		 	$	7,485		 	$	4,183		 	$	(41	)	 	$	11,627		
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating income (loss) - as reported	 	$	455		 	$	281		 	$	(107	)	 	$	629		 	$	1,587		 	$	557		 	$	(238	)	 	$	1,906		
Intangible asset amortization	 	28		 	42		 	—		 	70		 	105		 	172		 	—		 	277		
Pension Settlements	 	83		 	25		 	50		 	158		 	144		 	26		 	50		 	220		
Transaction Costs	 	$	—		 	$	15		 	$	—		 	$	15		 	$	—		 	$	15		 	$	—		 	$	15		
Operating income (loss) - as adjusted	 	$	566		 	$	363		 	$	(57	)	 	$	872		 	$	1,836		 	$	770		 	$	(188	)	 	$	2,418		
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating margins - as adjusted	 	27.6	%	 	28.3	%	 	N/A		 	26.2	%	 	24.5	%	 	18.4	%	 	N/A		 	20.8	%	

																																	
 	 	Three Months Ended December 31, 2015	 	Twelve Months Ended December 31, 2015	
(millions)	 	Risk
Solutions	 	HR
Solutions	 	Unallocated
Income &
Expense	 	Total	 	Risk
Solutions	 	HR
Solutions	 	Unallocated
Income &
Expense	 	Total	
Revenue	 	$	2,009		 	$	1,290		 	$	(11	)	 	$	3,288		 	$	7,426		 	$	4,303		 	$	(47	)	 	$	11,682		
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating income (loss) - as reported	 	$	491		 	$	287		 	$	(61	)	 	$	717		 	$	1,506		 	$	536		 	$	(194	)	 	$	1,848		
Intangible asset amortization	 	26		 	51		 	—		 	77		 	109		 	205		 	—		 	314		
Legacy litigation	 	—		 	—		 	—		 	—		 	137		 	39		 	—		 	176		
Operating income (loss) - as adjusted	 	$	517		 	$	338		 	$	(61	)	 	$	794		 	$	1,752		 	$	780		 	$	(194	)	 	$	2,338		
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating margins - as adjusted	 	25.7	%	 	26.2	%	 	N/A		 	24.1	%	 	23.6	%	 	18.1	%	 	N/A		 	20.0	%	

																	
 	 	Three Months Ended December 31,	 	Twelve Months Ended December 31,	
(millions except per share data)	 	2016	 	2015	 	2016	 	2015	
Operating income - as adjusted	 	$	872		 	$	794		 	$	2,418		 	$	2,338		
Interest income	 	3		 	4		 	9		 	14		
Interest expense	 	(70	)	 	(68	)	 	(282	)	 	(273	)	
Other income	 	9		 	49		 	36		 	100		
 	 	 	 	 	 	 	 	 	
Income before income taxes - as adjusted	 	814		 	779		 	2,181		 	2,179		
Income taxes (2)	 	121		 	140		 	367		 	389		
Net income - as adjusted	 	693		 	639		 	1,814		 	1,790		
Less: Net income attributable to noncontrolling interests	 	7		 	6		 	34		 	37		
Net income attributable to Aon shareholders - as adjusted	 	$	686		 	$	633		 	$	1,780		 	$	1,753		
 	 	 	 	 	 	 	 	 	
Diluted earnings per share - as adjusted	 	$	2.56		 	$	2.27		 	$	6.59		 	$	6.18		
 	 	 	 	 	 	 	 	 	
Weighted average ordinary shares outstanding - diluted	 	268.3		 	279.3		 	270.3		 	283.8		

(1)   	Certain noteworthy items impacting operating income in 2016 and 2015 are described in this schedule. The items shown with the caption "as adjusted" are non-GAAP measures.	
		
(2)  	The effective tax rate used in the U.S. GAAP financial statements were 10.9% and 15.8% for the three months ended December 31, 2016 and 2015 , respectively, and 14.3% and 15.8% for the twelve months ended December 31, 2016 and 2015 , respectively. Reconciling items are generally taxed at the effective tax rate. However, after adjusting to exclude the applicable tax impact associated with non-cash pension expenses, the adjusted effective tax rates for the fourth quarter and twelve months ended December 31, 2016 were 14.9% and 16.8% , respectively. After adjusting the underlying annual tax rate to exclude the impact associated with expenses for legacy litigation in the second quarter, the adjusted effective tax rates for both the fourth quarter and twelve months of 2015 was 17.9% .	

13

Aon plc
Condensed Consolidated Statements of Financial Position (Unaudited)

									
 	 	As of	
(millions) 	 	December 31,
2016	 	December 31, 2015 (1)	
 	 	 	 	(As revised)	
ASSETS	 	 		 	 		
Current Assets	 	 		 	 		
Cash and cash equivalents	 	$	431		 	$	384		
Short-term investments	 	290		 	356		
Receivables, net	 	2,589		 	2,564		
Fiduciary assets	 	9,485		 	9,932		
Other current assets	 	351		 	329		
Total Current Assets	 	13,146		 	13,565		
Goodwill	 	8,747		 	8,448		
Intangible assets, net	 	2,223		 	2,180		
Fixed assets, net	 	765		 	765		
Non-current deferred tax assets	 	322		 	300		
Prepaid pension	 	858		 	1,033		
Other non-current assets	 	554		 	592		
Total Assets	 	$	26,615		 	$	26,883		
 	 	 	 	 	
LIABILITIES AND EQUITY	 	 		 	 		
Current Liabilities	 	 		 	 		
Accounts payable and accrued liabilities	 	$	1,801		 	$	1,772		
Short-term debt and current portion of long-term debt	 	336		 	562		
Fiduciary liabilities	 	9,485		 	9,932		
Other current liabilities	 	873		 	819		
Total Current Liabilities	 	12,495		 	13,085		
Long-term debt	 	5,869		 	5,138		
Non-current deferred tax liabilities	 	101		 	37		
Pension, other post-retirement and other post-employment liabilities	 	1,774		 	1,795		
Other non-current liabilities	 	844		 	769		
Total Liabilities	 	21,083		 	20,824		
 	 	 	 	 	
EQUITY	 	 		 	 		
Shareholders' Equity	 	 		 	 		
Ordinary shares ($0.01 nominal value)	 	3		 	3		
Additional paid-in capital	 	5,577		 	5,409		
Retained earnings	 	3,807		 	4,013		
Accumulated other comprehensive loss	 	(3,912	)	 	(3,423	)	
Total Aon Shareholders' Equity	 	5,475		 	6,002		
Noncontrolling interests	 	57		 	57		
Total Equity	 	5,532		 	6,059		
Total Liabilities and Equity	 	$	26,615		 	$	26,883		

(1)     Refer to "Revision of Previously Issued Financial Statements" as disclosed in the schedules on pages 16 and 17.
(2)     Includes short-term investments:  2016 - $3,816 million , 2015 - $3,394 million

14

Aon plc
Consolidated Statements of Cash Flows (Unaudited)

										
(millions) 	Years ended December 31	 	2016	 	2015	
 	 	 	(Unaudited)	 	 	
CASH FLOWS FROM OPERATING ACTIVITIES	 	 	 		 	 		
Net income	 	$	1,430		 	$	1,422		
Adjustments to reconcile net income to cash provided by operating activities:           	 	 		 	 		
Gain from sales of businesses and investments, net	 	(39	)	 	(81	)	
Depreciation of fixed assets	 	232		 	229		
Amortization of intangible assets	 	277		 	314		
Share-based compensation expense	 	331		 	340		
Deferred income taxes	 	(24	)	 	(223	)	
Change in assets and liabilities:	 	 		 	 		
Fiduciary receivables	 	594		 	599		
Short-term investments — funds held on behalf of clients	 	(598	)	 	350		
Fiduciary liabilities	 	4		 	(949	)	
Receivables, net	 	(86	)	 	(83	)	
Accounts payable and accrued liabilities	 	64		 	87		
Current income taxes	 	49		 	116		
Pension, other post-retirement and other post-employment liabilities	 	42		 	(230	)	
Other assets and liabilities	 	50		 	118		
CASH PROVIDED BY OPERATING ACTIVITIES	 	 	2,326		 	2,009		
 	 	 	 	 	 	
CASH FLOWS FROM INVESTING ACTIVITIES	 	 	 		 	 		
Proceeds from investments	 	 	43		 	220		
Payments for investments	 	 	(64	)	 	(266	)	
Net sales (purchases) of short-term investments — non-fiduciary	 	 	61		 	9		
Acquisition of businesses, net of cash acquired	 	 	(879	)	 	(16	)	
Proceeds from sale of businesses	 	 	107		 	205		
Capital expenditures	 	 	(222	)	 	(290	)	
CASH USED FOR INVESTING ACTIVITIES	 	 	(954	)	 	(138	)	
 	 	 	 	 	 	
CASH FLOWS FROM FINANCING ACTIVITIES	 	 	 		 	 		
Share repurchase	 	 	(1,257	)	 	(1,550	)	
Issuance of shares for employee benefit plans	 	 	(129	)	 	(30	)	
Issuance of debt	 	 	3,467		 	5,351		
Repayment of debt	 	 	(2,945	)	 	(5,098	)	
Cash dividends to shareholders	 	 	(345	)	 	(323	)	
Noncontrolling interests and other financing activities	 	 	(77	)	 	(39	)	
CASH USED FOR FINANCING ACTIVITIES	 	 	(1,286	)	 	(1,689	)	
 	 	 	 	 	 	
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	 	(39	)	 	(172	)	
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	 	 	47		 	10		
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR	 	 	384		 	374		
CASH AND CASH EQUIVALENTS AT END OF YEAR	 	 	$	431		 	$	384		

15

Aon plc
Revision of Previously Issued Financial Statements (in millions, except per share data)

During the fourth quarter of 2016, the Company identified legacy immaterial errors related to the quarterly timing of revenue recognition for certain brokerage fee agreements in our Americas Retail Brokerage business in Risk Solutions, primarily impacting US Retail. Historically, revenue for these arrangements was typically recognized upon signing an agreement with a customer; however, in some cases, a portion of the arrangement’s revenue should have been recognized in subsequent quarters upon the placement of effective policies.  This historical practice resulted in over-recognizing revenue in the fourth quarter and under-recognizing revenue in the first, second, and third quarters of each year. The revised quarterly revenue disclosures included in the schedules of this press release align with the appropriate practice and will be used going forward as reported amounts for the corresponding period. 

The impact to the Consolidated Statements of Financial Position was a decrease of $170 million to Net receivables, an increase of $66 million to Non-current deferred tax assets, and a decrease of $104 million to Retained earnings in all periods presented. The impact to full year Organic Revenue, Consolidated Statements of Income and Cash Flows was immaterial and therefore remain unchanged.

	
																																								
 	US GAAP	 	Non GAAP - as adjusted (1)	
(As reported)	1Q	 	2Q	 	3Q	 	4Q	 	2016	 	1Q	 	2Q	 	3Q	 	4Q	 	2016	
INCOME STATEMENT DATA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Commissions, fees and other revenue	$	2,787		 	$	2,761		 	$	2,740		 	$	3,317		 	$	11,605		 	$	2,787		 	$	2,761		 	$	2,740		 	$	3,317		 	$	11,605		
Fiduciary investment income	5		 	5		 	6		 	6		 	22		 	5		 	5		 	6		 	6		 	22		
Total revenue	2,792		 	2,766		 	2,746		 	3,323		 	11,627		 	2,792		 	2,766		 	2,746		 	3,323		 	11,627		
Operating income	450		 	405		 	422		 	629		 	1,906		 	517		 	535		 	494		 	872		 	2,418		
Net income	327		 	280		 	314		 	509		 	1,430		 	382		 	384		 	355		 	693		 	1,814		
Less: Net income attributable to noncontrolling interests	12		 	8		 	7		 	7		 	34		 	12		 	8		 	7		 	7		 	34		
Net income attributable to Aon shareholders	$	315		 	$	272		 	$	307		 	$	502		 	$	1,396		 	$	370		 	$	376		 	$	348		 	$	686		 	$	1,780		
PER SHARE DATA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 		
Basic net income per share attributable to Aon shareholders	$	1.16		 	$	1.01		 	$	1.15		 	$	1.89		 	$	5.21		 	 	 	 	 	 	 	 	 			
Diluted net income per share attributable to Aon shareholders	$	1.15		 	$	1.01		 	$	1.14		 	$	1.87		 	$	5.16		 	$	1.35		 	$	1.39		 	$	1.29		 	$	2.56		 	$	6.59		
(Effect of revision)	 	
INCOME STATEMENT DATA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Commissions, fees and other revenue	$	13		 	$	34		 	$	14		 	$	(61	)	 	$	—		 	$	13		 	$	34		 	$	14		 	$	(61	)	 	$	—		
Fiduciary investment income	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		
Total revenue	13		 	34		 	14		 	(61	)	 	—		 	13		 	34		 	14		 	(61	)	 	—		
Operating income	13		 	34		 	14		 	(61	)	 	—		 	13		 	34		 	14		 	(61	)	 	—		
Net income	10		 	28		 	12		 	(50	)	 	—		 	10		 	28		 	12		 	(50	)	 	—		
Less: Net income attributable to noncontrolling interests	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		
Net income attributable to Aon shareholders	$	10		 	$	28		 	$	12		 	$	(50	)	 	$	—		 	$	10		 	$	28		 	$	12		 	$	(50	)	 	$	—		
PER SHARE DATA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic net income per share attributable to Aon shareholders	$	0.04		 	$	0.11		 	$	0.04		 	$	(0.19	)	 	$	—		 	 	 	 	 	 	 	 	 	 	
Diluted net income per share attributable to Aon shareholders	$	0.04		 	$	0.10		 	$	0.04		 	$	(0.19	)	 	$	—		 	$	0.04		 	$	0.10		 	$	0.04		 	$	(0.19	)	 	$	—		
(As revised)	 	
INCOME STATEMENT DATA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Commissions, fees and other revenue	$	2,800		 	$	2,795		 	$	2,754		 	$	3,256		 	$	11,605		 	$	2,800		 	$	2,795		 	$	2,754		 	$	3,256		 	$	11,605		
Fiduciary investment income	5		 	5		 	6		 	6		 	22		 	5		 	5		 	6		 	6		 	22		
Total revenue	2,805		 	2,800		 	2,760		 	3,262		 	11,627		 	2,805		 	2,800		 	2,760		 	3,262		 	11,627		
Operating income	463		 	439		 	436		 	568		 	1,906		 	530		 	569		 	508		 	811		 	2,418		
Net income	337		 	308		 	326		 	459		 	1,430		 	392		 	412		 	367		 	643		 	1,814		
Less: Net income attributable to noncontrolling interests	12		 	8		 	7		 	7		 	34		 	12		 	8		 	7		 	7		 	34		
Net income attributable to Aon shareholders	$	325		 	$	300		 	$	319		 	$	452		 	$	1,396		 	$	380		 	$	404		 	$	360		 	$	636		 	$	1,780		
PER SHARE DATA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic net income per share attributable to Aon shareholders	$	1.20		 	$	1.12		 	$	1.19		 	$	1.70		 	$	5.21		 	 	 	 	 	 	 	 	 	 	
Diluted net income per share attributable to Aon shareholders	$	1.19		 	$	1.11		 	$	1.18		 	$	1.68		 	$	5.16		 	$	1.39		 	$	1.49		 	$	1.33		 	$	2.37		 	$	6.59		

(1) Refer to Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings Per Share for adjustments to operating income, net income, and diluted earnings per share on page 13.

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 	US GAAP	 	Non GAAP - as adjusted (1)	
(As reported)	1Q	 	2Q	 	3Q	 	4Q	 	2015	 	1Q	 	2Q	 	3Q	 	4Q	 	2015	
INCOME STATEMENT DATA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Commissions, fees and other revenue	$	2,842		 	$	2,800		 	$	2,736		 	$	3,283		 	$	11,661		 	$	2,842		 	$	2,800		 	$	2,736		 	$	3,283		 	$	11,661		
Fiduciary investment income	5		 	5		 	6		 	5		 	21		 	5		 	5		 	6		 	5		 	21		
Total revenue	2,847		 	2,805		 	2,742		 	3,288		 	11,682		 	2,847		 	2,805		 	2,742		 	3,288		 	11,682		
Operating income	441		 	277		 	413		 	717		 	1,848		 	521		 	532		 	491		 	794		 	2,338		
Net income	341		 	188		 	303		 	590		 	1,422		 	405		 	385		 	361		 	639		 	1,790		
Less: Net income attributable to noncontrolling interests	13		 	10		 	8		 	6		 	37		 	13		 	10		 	8		 	6		 	37		
Net income attributable to Aon shareholders	$	328		 	$	178		 	$	295		 	$	584		 	$	1,385		 	$	392		 	$	375		 	$	353		 	$	633		 	$	1,753		
PER SHARE DATA	 	 	 	 	 	 	 	 	 	 	  	 	  	 	  	 	  	 	  	
Basic net income per share attributable to Aon shareholders	$	1.15		 	$	0.63		 	$	1.05		 	$	2.12		 	$	4.93		 	 	 	 	 	 	 	 	 	 	
Diluted net income per share attributable to Aon shareholders	$	1.14		 	$	0.62		 	$	1.04		 	$	2.09		 	$	4.88		 	$	1.37		 	$	1.31		 	$	1.24		 	$	2.27		 	$	6.18		
(Effect of revision)	 	
INCOME STATEMENT DATA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Commissions, fees and other revenue	$	20		 	$	31		 	$	10		 	$	(61	)	 	$	—		 	$	20		 	$	31		 	$	10		 	$	(61	)	 	$	—		
Fiduciary investment income	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		
Total revenue	20		 	31		 	10		 	(61	)	 	—		 	20		 	31		 	10		 	(61	)	 	—		
Operating income	20		 	31		 	10		 	(61	)	 	—		 	20		 	31		 	10		 	(61	)	 	—		
Net income	16		 	26		 	8		 	(50	)	 	—		 	16		 	26		 	8		 	(50	)	 	—		
Less: Net income attributable to noncontrolling interests	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		 	—		
Net income attributable to Aon shareholders	$	16		 	$	26		 	$	8		 	$	(50	)	 	$	—		 	$	16		 	$	26		 	$	8		 	$	(50	)	 	$	—		
PER SHARE DATA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic net income per share attributable to Aon shareholders	$	0.06		 	$	0.09		 	$	0.03		 	$	(0.18	)	 	$	—		 	 	 	 	 	 	 	 	 	 	
Diluted net income per share attributable to Aon shareholders	$	0.06		 	$	0.09		 	$	0.03		 	$	(0.18	)	 	$	—		 	$	0.05		 	$	0.09		 	$	0.03		 	$	(0.18	)	 	$	—		
(As revised)	 	
INCOME STATEMENT DATA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Commissions, fees and other revenue	$	2,862		 	$	2,831		 	$	2,746		 	$	3,222		 	$	11,661		 	$	2,862		 	$	2,831		 	$	2,746		 	$	3,222		 	$	11,661		
Fiduciary investment income	5		 	5		 	6		 	5		 	21		 	5		 	5		 	6		 	5		 	21		
Total revenue	2,867		 	2,836		 	2,752		 	3,227		 	11,682		 	2,867		 	2,836		 	2,752		 	3,227		 	11,682		
Operating income	461		 	308		 	423		 	656		 	1,848		 	541		 	563		 	501		 	733		 	2,338		
Net income	357		 	214		 	311		 	540		 	1,422		 	421		 	411		 	369		 	589		 	1,790		
Less: Net income attributable to noncontrolling interests	13		 	10		 	8		 	6		 	37		 	13		 	10		 	8		 	6		 	37		
Net income attributable to Aon shareholders	$	344		 	$	204		 	$	303		 	$	534		 	$	1,385		 	$	408		 	$	401		 	$	361		 	$	583		 	$	1,753		
PER SHARE DATA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic net income per share attributable to Aon shareholders	$	1.21		 	$	0.72		 	$	1.08		 	$	1.94		 	$	4.93		 	 	 	 	 	 	 	 	 	 	
Diluted net income per share attributable to Aon shareholders	$	1.20		 	$	0.71		 	$	1.07		 	$	1.91		 	$	4.88		 	$	1.42		 	$	1.40		 	$	1.27		 	$	2.09		 	$	6.18		

(1) Refer to Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings Per Share for adjustments to operating income, net income, and diluted earnings per share on page 13.

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