AON PLC, 10-Q filed on 7/26/2019
Quarterly Report
v3.19.2
Cover Page - shares
6 Months Ended
Jun. 30, 2019
Jul. 25, 2019
Cover page.    
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Jun. 30, 2019  
Document Transition Report false  
Entity File Number 1-7933  
Entity Registrant Name Aon plc  
Entity Incorporation, State or Country Code X0  
Entity Tax Identification Number 98-1030901  
Entity Address, Address Line One 122 LEADENHALL STREET  
Entity Address, City or Town LONDON  
Entity Address, Country GB  
Entity Address, Postal Zip Code EC3V 4AN  
City Area Code 20  
Local Phone Number 7623 5500  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Large Accelerated Filer  
Entity Small Business false  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   235,841,886
Entity Central Index Key 0000315293  
Amendment Flag false  
Current Fiscal Year End Date --12-31  
Document Fiscal Year Focus 2019  
Document Fiscal Period Focus Q2  
v3.19.2
Condensed Consolidated Statements of Income (Unaudited) - USD ($)
shares in Millions, $ in Millions
3 Months Ended 6 Months Ended
Jun. 30, 2019
Jun. 30, 2018
Jun. 30, 2019
Jun. 30, 2018
Revenue        
Total revenue $ 2,606 $ 2,561 $ 5,749 $ 5,651
Expenses        
Compensation and benefits 1,501 1,494 3,085 3,110
Information technology 126 123 243 238
Premises 85 96 172 189
Depreciation of fixed assets 40 47 80 86
Amortization and impairment of intangible assets 97 282 194 392
Other general expenses 344 535 690 853
Total operating expenses 2,193 2,577 4,464 4,868
Operating income (loss) 413 (16) 1,285 783
Interest income 1 1 3 5
Interest expense (77) (69) (149) (139)
Other income (expense) 6 (3) 6 (18)
Income (loss) from continuing operations before income taxes 343 (87) 1,145 631
Income tax expense (benefit) 56 (144) 182 (30)
Net income from continuing operations 287 57 963 661
Net income from discontinued operations 0 1 0 7
Net income 287 58 963 668
Less: Net income attributable to noncontrolling interests 10 10 27 26
Net income attributable to Aon shareholders $ 277 $ 48 $ 936 $ 642
Basic net income per share attributable to Aon shareholders        
Continuing operations (in dollars per share) $ 1.15 $ 0.19 $ 3.88 $ 2.57
Discontinued operations (in dollars per share) 0 0.01 0 0.03
Net income (in dollars per share) 1.15 0.20 3.88 2.60
Diluted net income per share attributable to Aon shareholders        
Continuing operations (in dollars per share) 1.14 0.19 3.85 2.55
Discontinued operations (in dollars per share) 0 0 0 0.03
Net income (in dollars per share) $ 1.14 $ 0.19 $ 3.85 $ 2.58
Weighted average ordinary shares outstanding - basic (in shares) 240.6 246.0 241.4 247.2
Weighted average ordinary shares outstanding - diluted (in shares) 242.8 247.4 243.2 248.8
v3.19.2
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($)
$ in Millions
3 Months Ended 6 Months Ended
Jun. 30, 2019
Jun. 30, 2018
Jun. 30, 2019
Jun. 30, 2018
Statement of Comprehensive Income [Abstract]        
Net income $ 287 $ 58 $ 963 $ 668
Less: Net income attributable to noncontrolling interests 10 10 27 26
Net income attributable to Aon shareholders 277 48 936 642
Other comprehensive income (loss), net of tax:        
Change in fair value of financial instruments (8) (1) (1) 13
Foreign currency translation adjustments (103) (460) 30 (213)
Postretirement benefit obligation 14 122 45 170
Total other comprehensive income (loss) (97) (339) 74 (30)
Less: Other comprehensive income (loss) attributable to noncontrolling interests 0 (6) 2 (3)
Total other comprehensive income (loss) attributable to Aon shareholders (97) (333) 72 (27)
Comprehensive income (loss) attributable to Aon shareholders $ 180 $ (285) $ 1,008 $ 615
v3.19.2
Condensed Consolidated Statements of Financial Position - USD ($)
$ in Millions
Jun. 30, 2019
Dec. 31, 2018
Current assets    
Cash and cash equivalents $ 581 $ 656
Short-term investments 235 172
Receivables, net 3,227 2,760
Fiduciary assets 12,071 10,166
Other current assets 631 618
Total current assets 16,745 14,372
Goodwill 8,198 8,171
Intangible assets, net 973 1,149
Fixed assets, net 599 588
Operating lease right-of-use assets 959  
Deferred tax assets 599 561
Prepaid pension 1,213 1,133
Other non-current assets 521 448
Total assets 29,807 26,422
Current liabilities    
Accounts payable and accrued liabilities 1,369 1,943
Short-term debt and current portion of long-term debt 844 251
Fiduciary liabilities 12,071 10,166
Other current liabilities 1,197 936
Total current liabilities 15,481 13,296
Long-term debt 6,740 5,993
Non-current operating lease liabilities 962  
Deferred tax liabilities 211 181
Pension, other postretirement, and postemployment liabilities 1,576 1,636
Other non-current liabilities 924 1,097
Total liabilities 25,894 22,203
Equity    
Ordinary shares - $0.01 nominal value Authorized: 750 shares (issued: 2019 - 235.7; 2018 - 240.1) 2 2
Additional paid-in capital 6,002 5,965
Retained earnings 1,669 2,093
Accumulated other comprehensive loss (3,837) (3,909)
Total Aon shareholders' equity 3,836 4,151
Noncontrolling interests 77 68
Total equity 3,913 4,219
Total liabilities and equity $ 29,807 $ 26,422
v3.19.2
Condensed Consolidated Statements of Financial Position (Parenthetical) - $ / shares
Jun. 30, 2019
Dec. 31, 2018
Statement of Financial Position [Abstract]    
Common stock, nominal or par value (in dollars per share) $ 0.01 $ 0.01
Common stock, authorized shares (in shares) 750,000,000 750,000,000
Common stock, issued shares (in shares) 235,700,000 240,100,000
v3.19.2
Condensed Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($)
shares in Millions, $ in Millions
Total
Ordinary Shares and Additional Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive Loss, Net of Tax
Non- controlling Interests
Beginning Balance (in shares) at Dec. 31, 2017   247.6      
Beginning Balance at Dec. 31, 2017 $ 5,140 $ 5,777 $ 2,795 $ (3,497) $ 65
Increase (Decrease) in Shareholders' Equity          
Net income 610   594   16
Shares issued - employee stock compensation plans (in shares)   1.5      
Shares issued - employee stock compensation plans (109) $ (109)      
Shares purchased (in shares)   (3.9)      
Shares purchased (553)   (553)    
Share-based compensation expense 77 $ 77      
Dividends to shareholders (89)   (89)    
Net change in fair value of financial instruments 14     14  
Net foreign currency translation adjustments 247     244 3
Net postretirement benefit obligation 48     48  
Ending Balance (in shares) at Mar. 31, 2018   245.2      
Ending Balance at Mar. 31, 2018 5,385 $ 5,745 2,747 (3,191) 84
Beginning Balance (in shares) at Dec. 31, 2017   247.6      
Beginning Balance at Dec. 31, 2017 5,140 $ 5,777 2,795 (3,497) 65
Increase (Decrease) in Shareholders' Equity          
Net income 668        
Net change in fair value of financial instruments 13        
Net foreign currency translation adjustments (213)        
Net postretirement benefit obligation 170        
Ending Balance (in shares) at Jun. 30, 2018   243.0      
Ending Balance at Jun. 30, 2018 4,618 $ 5,774 2,295 (3,524) 73
Beginning Balance (in shares) at Mar. 31, 2018   245.2      
Beginning Balance at Mar. 31, 2018 5,385 $ 5,745 2,747 (3,191) 84
Increase (Decrease) in Shareholders' Equity          
Net income 58   48   10
Shares issued - employee stock compensation plans (in shares)   0.6      
Shares issued - employee stock compensation plans (41) $ (41)      
Shares purchased (in shares)   (2.8)      
Shares purchased (402)   (402)    
Share-based compensation expense 70 $ 70      
Dividends to shareholders (98)   (98)    
Net change in fair value of financial instruments (1)     (1)  
Net foreign currency translation adjustments (460)     (454) (6)
Net postretirement benefit obligation 122     122  
Purchases of shares from noncontrolling interests (1)       (1)
Dividends paid to noncontrolling interests on subsidiary common stock (14)       (14)
Ending Balance (in shares) at Jun. 30, 2018   243.0      
Ending Balance at Jun. 30, 2018 $ 4,618 $ 5,774 2,295 (3,524) 73
Beginning Balance (in shares) at Dec. 31, 2018 240.1 240.1      
Beginning Balance at Dec. 31, 2018 $ 4,219 $ 5,967 2,093 (3,909) 68
Increase (Decrease) in Shareholders' Equity          
Net income 676   659   17
Shares issued - employee stock compensation plans (in shares)   1.4      
Shares issued - employee stock compensation plans (96) $ (96)      
Shares purchased (in shares)   (0.6)      
Shares purchased (101)   (101)    
Share-based compensation expense 89 $ 89      
Dividends to shareholders (96)   (96)    
Net change in fair value of financial instruments 7     7  
Net foreign currency translation adjustments 133     131 2
Net postretirement benefit obligation 31     31  
Ending Balance (in shares) at Mar. 31, 2019   240.9      
Ending Balance at Mar. 31, 2019 $ 4,862 $ 5,960 2,555 (3,740) 87
Beginning Balance (in shares) at Dec. 31, 2018 240.1 240.1      
Beginning Balance at Dec. 31, 2018 $ 4,219 $ 5,967 2,093 (3,909) 68
Increase (Decrease) in Shareholders' Equity          
Net income 963        
Net change in fair value of financial instruments (1)        
Net foreign currency translation adjustments 30        
Net postretirement benefit obligation $ 45        
Ending Balance (in shares) at Jun. 30, 2019 235.7 235.7      
Ending Balance at Jun. 30, 2019 $ 3,913 $ 6,004 1,669 (3,837) 77
Beginning Balance (in shares) at Mar. 31, 2019   240.9      
Beginning Balance at Mar. 31, 2019 4,862 $ 5,960 2,555 (3,740) 87
Increase (Decrease) in Shareholders' Equity          
Net income 287   277   10
Shares issued - employee stock compensation plans (in shares)   0.6      
Shares issued - employee stock compensation plans (47) $ (47)      
Shares purchased (in shares)   (5.8)      
Shares purchased (1,056)   (1,056)    
Share-based compensation expense 91 $ 91      
Dividends to shareholders (107)   (107)    
Net change in fair value of financial instruments (8)     (8)  
Net foreign currency translation adjustments (103)     (103)  
Net postretirement benefit obligation 14     14  
Dividends paid to noncontrolling interests on subsidiary common stock $ (20)       (20)
Ending Balance (in shares) at Jun. 30, 2019 235.7 235.7      
Ending Balance at Jun. 30, 2019 $ 3,913 $ 6,004 $ 1,669 $ (3,837) $ 77
v3.19.2
Condensed Consolidated Statement of Shareholders' Equity Unaudited (Parenthetical) - $ / shares
3 Months Ended
Jun. 30, 2019
Mar. 31, 2019
Jun. 30, 2018
Mar. 31, 2018
Statement of Stockholders' Equity [Abstract]        
Dividends (in dollars per share) $ 0.44 $ 0.40 $ 0.40 $ 0.36
v3.19.2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
$ in Millions
6 Months Ended
Jun. 30, 2019
Jun. 30, 2018
Cash flows from operating activities    
Net income $ 963 $ 668
Net income from discontinued operations 0 7
Adjustments to reconcile net income to cash provided by operating activities:    
(Gain) loss from sales of businesses, net (7) 1
Depreciation of fixed assets 80 86
Amortization and impairment of intangible assets 194 392
Share-based compensation expense 180 147
Deferred income taxes (25) (93)
Change in assets and liabilities:    
Fiduciary receivables (926) (883)
Short-term investments — funds held on behalf of clients (961) (154)
Fiduciary liabilities 1,887 1,037
Receivables, net (477) (371)
Accounts payable and accrued liabilities (579) (495)
Restructuring reserves (18) 12
Current income taxes 10 (144)
Pension, other postretirement and postemployment liabilities (92) (84)
Other assets and liabilities 132 301
Cash provided by operating activities 361 413
Cash flows from investing activities    
Proceeds from investments 14 23
Payments for investments (60) (36)
Net sales (purchases) of short-term investments — non-fiduciary (62) 352
Acquisition of businesses, net of cash acquired (15) (50)
Sale of businesses, net of cash sold 7 1
Capital expenditures (106) (111)
Cash provided by (used for) investing activities (222) 179
Cash flows from financing activities    
Share repurchase (1,155) (971)
Issuance of shares for employee benefit plans (144) (150)
Issuance of debt 3,559 2,552
Repayment of debt (2,228) (2,027)
Cash dividends to shareholders (203) (187)
Noncontrolling interests and other financing activities (61) (15)
Cash used for financing activities (232) (798)
Effect of exchange rates on cash and cash equivalents 18 (63)
Net increase (decrease) in cash and cash equivalents (75) (269)
Cash and cash equivalents at beginning of period 656 756
Cash and cash equivalents at end of period 581 487
Supplemental disclosures:    
Interest paid 147 145
Income taxes paid, net of refunds $ 197 $ 207
v3.19.2
Basis of Presentation
6 Months Ended
Jun. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of Presentation 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 Financial Statements include the accounts of Aon plc and all of its controlled subsidiaries (“Aon” or the “Company”). Intercompany accounts and transactions have been eliminated. The 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 prepared in accordance with U.S. GAAP have been condensed or omitted. These 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, 2018. The results for the three and six months ended June 30, 2019 are not necessarily indicative of operating results that may be expected for the full year ending December 31, 2019.
Use of Estimates
The preparation of the accompanying 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, and the reported amounts of reserves and expenses. These estimates and assumptions are based on management’s best estimates and judgments. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. Management believes its estimates to be reasonable given the current facts available. Aon adjusts such estimates and assumptions when facts and circumstances dictate.  Illiquid credit markets, volatile equity markets, and foreign currency exchange rate movements increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in estimates resulting from continuing changes in the economic environment would, if applicable, be reflected in the Financial Statements in future periods.
v3.19.2
Accounting Principles and Practices
6 Months Ended
Jun. 30, 2019
Accounting Policies [Abstract]  
Accounting Principles and Practices Accounting Principles and Practices
Adoption of New Accounting Standards
Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income
In February 2018, the FASB issued new accounting guidance related to reclassification of certain tax effects from accumulated other comprehensive income. The guidance allowed a reclassification from accumulated comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017. The guidance was effective for the Company in the first quarter of 2019. For the three and six months ended June 30, 2019, there was no impact on the net income of the Company as Aon did not elect to reclassify stranded tax effects on the Condensed Consolidated Statement of Financial Position. It is the Company’s policy to release income tax effects from accumulated other comprehensive loss using the portfolio approach.
Targeted Improvements to Accounting for Hedging Activities
In August 2017, the FASB issued new accounting guidance on targeted improvements to accounting for hedging activities. The new guidance amended its hedge accounting model to enable entities to better portray their risk management activities in the financial statements. The guidance eliminated the requirement to separately measure and report hedge ineffectiveness and required the effect of a hedging instrument to be presented in the same income statement line as the hedged item. The new guidance was effective for Aon in the first quarter of 2019 and the Company adopted it on a modified retrospective basis with no cumulative effect adjustment to accumulated other comprehensive income or corresponding adjustment to Retained earnings. Changes to the Condensed Consolidated Statement of Income and financial statement disclosures were applied prospectively. Under the new guidance, gains or losses on certain derivative hedging instruments are recognized in revenue, as opposed to other income (expense) under the previous guidance. For the three and six months ended June 30, 2019, the adoption of this guidance had no impact on the net income and an insignificant impact on the operating income of the Company.
Leases
In February 2016, the FASB issued a new accounting standard on leases, which requires lessees to recognize assets and liabilities for most leases. Under the new standard, a lessee is required to recognize in the Consolidated Statements of Financial Position, liabilities to make future lease payments and right-of-use (“ROU”) assets representing its right to use the underlying assets for the lease term. The recognition, measurement, timing, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from previous U.S. GAAP.
The Company adopted the new standard as of January 1, 2019, using the modified retrospective approach for all leases existing at, or entered into after, the period of adoption. Under this approach, prior periods were not restated. Rather, lease balances and other disclosures for prior periods were provided in the notes to the financial statements as previously reported, and the cumulative effect of initially applying the guidance was recognized in the Condensed Consolidated Statement of Financial Position.
The modified retrospective approach includes several optional practical expedients available that entities may elect to apply upon transition. These practical expedients relate to the identification and classification of leases that commenced before the effective date, initial direct costs for leases that commenced before the effective date, and the ability to use hindsight in evaluating lessee options to extend or terminate a lease or to purchase the underlying asset. The Company elected the package of practical expedients permitted under the transition guidance within the new standard, which allows a lessee to carryforward their population of existing leases, the classification of each lease, as well as the treatment of initial direct costs as of the period of adoption. In addition, the Company elected the practical expedient related to lease and non-lease components, as an accounting policy election for all asset classes, which allows a lessee to not separate non-lease from lease components and instead account for consideration paid in a contract as a single lease component. Lastly, the Company did not elect the practical expedient related to hindsight analysis which allows a lessee to use hindsight in determining the lease term and in assessing impairment of the entity’s ROU assets.
The Company has made a policy election to not recognize ROU assets and lease liabilities that arise from leases with an initial term of twelve months or less on the Condensed Consolidated Statements of Financial Position. However, the Company will recognize these lease payments in the Condensed Consolidated Statements of Income on a straight-line basis over the lease term and variable lease payments in the period in which the obligation is incurred. The Company has chosen to apply this accounting policy across all classes of underlying assets. Additionally, upon adoption, the Company utilized a discount rate to determine the present value of the lease payments based on information available as of January 1, 2019.
Beginning January 1, 2019, operating ROU assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term at the commencement date. Operating leases in effect prior to January 1, 2019 were recognized at the present value of the remaining payments on the remaining lease term as of January 1, 2019. Upon adoption, the Company recognized ROU assets and lease liabilities of $1.1 billion and $1.3 billion, respectively. The standard had an insignificant impact on the Condensed Consolidated Statements of Income and no impact on the Condensed Consolidated Statements of Cash Flows. Refer to Note 20 “Lease Commitments” for further information including significant assumptions and judgments made.

As a result of applying the modified retrospective approach to adopt the new leasing standard, the following adjustments were made to the Condensed Consolidated Statements of Financial Position as of January 1, 2019 (in millions):
 
December 31,
2018
 
 
 
January 1,
2019
 
As Reported
 
Adjustments
 
As Adjusted
Assets
 
 
 
 
 
Operating lease right-of-use assets
$

 
$
1,021

 
$
1,021

Other non-current assets
$
448

 
$
78

 
$
526

 
 
 
 
 
 
Liabilities
 
 
 
 
 
Other current liabilities
$
936

 
$
219

 
$
1,155

Non-current operating lease liabilities
$

 
$
1,014

 
$
1,014

Other non-current liabilities
$
1,097

 
$
(134
)
 
$
963


Accounting Standards Issued But Not Yet Adopted
Changes to the Disclosure Requirements for Defined Benefit Plans
In August 2018, the FASB issued new accounting guidance related to the disclosure requirements for employers that sponsor defined benefit pension and other postretirement benefit plans. The guidance requires sponsors of these plans to provide additional disclosures, including weighted average interest rates used in the entity’s cash balance pension plans and a narrative description of reasons for any significant gains or losses impacting the benefit obligation for the period, and eliminates certain previous disclosure requirements. The new guidance is effective for Aon in the first quarter of 2021 with early adoption permitted and will be applied retrospectively. The Company is currently evaluating the impact that the guidance will have on the Financial Statements and the period of adoption.
Simplifying the Test for Goodwill Impairment
In January 2017, the FASB issued new accounting guidance on simplifying the test for goodwill impairment. Currently the standard requires an entity to perform a two-step test to determine the amount, if any, of goodwill impairment. In Step 1, an entity compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of the reporting unit exceeds its fair value, the entity performs Step 2 and compares the implied fair value of goodwill with the carrying amount of that goodwill for that reporting unit. An impairment charge equal to the amount by which the carrying amount of goodwill for the reporting unit exceeds the implied fair value of that goodwill is recorded, limited to the amount of goodwill allocated to that reporting unit. The new guidance removes Step 2. An entity will apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not amend the optional qualitative assessment of goodwill impairment. An entity will apply the new guidance on a prospective basis. The new guidance is effective for Aon in the first quarter of 2020 and early adoption is permitted. The Company is currently evaluating the period of adoption, but does not expect a significant impact on the Financial Statements.
Credit Losses
In June 2016, the FASB issued a new accounting standard on the measurement of credit losses on financial instruments. The new standard replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. An entity will apply the new standard through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the standard is effective. The new standard is effective for Aon in the first quarter of 2020 with early adoption permitted. The Company is currently evaluating the impact that the standard will have on the Financial Statements and will adopt the new accounting standard in the first quarter of 2020.
v3.19.2
Revenue from Contracts with Customers
6 Months Ended
Jun. 30, 2019
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers Revenue from Contracts with Customers
Disaggregation of Revenue
The following table summarizes revenue from contracts with customers by principal service line (in millions):
 
 
Three Months Ended June 30
 
Six Months Ended June 30
 
 
2019
 
2018
 
2019
 
2018
Commercial Risk Solutions
 
$
1,167

 
$
1,166

 
$
2,285

 
$
2,350

Reinsurance Solutions
 
420

 
380

 
1,208

 
1,122

Retirement Solutions
 
419

 
431

 
839

 
855

Health Solutions
 
317

 
309

 
803

 
760

Data & Analytic Services
 
286

 
277

 
622

 
571

Elimination
 
(3
)
 
(2
)
 
(8
)
 
(7
)
Total revenue
 
$
2,606

 
$
2,561

 
$
5,749

 
$
5,651


Consolidated revenue from contracts with customers by geographic area, which is attributed on the basis of where the services are performed, is as follows (in millions):
 
 
Three Months Ended June 30
 
Six Months Ended June 30
 
 
2019
 
2018
 
2019
 
2018
United States
 
$
1,146

 
$
1,125

 
$
2,307

 
$
2,241

Americas other than United States
 
241

 
243

 
467

 
480

United Kingdom
 
400

 
413

 
852

 
897

Europe, Middle East, & Africa other than United Kingdom
 
501

 
493

 
1,510

 
1,472

Asia Pacific
 
318

 
287

 
613

 
561

Total revenue
 
$
2,606

 
$
2,561

 
$
5,749

 
$
5,651



Contract Costs

An analysis of the changes in the net carrying amount of costs to fulfill contracts with customers are as follows (in millions):
 
 
Three Months Ended June 30
 
Six Months Ended June 30
 
 
2019
 
2018
 
2019
 
2018
Balance at beginning of period
 
$
236

 
$
240

 
$
329

 
$
298

Additions
 
336

 
341

 
682

 
711

Amortization
 
(357
)
 
(353
)
 
(796
)
 
(785
)
Impairment
 

 

 

 

Foreign currency translation and other
 
1

 
(12
)
 
1

 
(8
)
Balance at end of period
 
$
216

 
$
216

 
$
216

 
$
216



An analysis of the changes in the net carrying amount of costs to obtain contracts with customers are as follows (in millions):
 
 
Three Months Ended June 30
 
Six Months Ended June 30
 
 
2019
 
2018
 
2019
 
2018
Balance at beginning of period
 
$
155

 
$
144

 
$
156

 
$
145

Additions
 
17

 
13

 
26

 
21

Amortization
 
(11
)
 
(11
)
 
(22
)
 
(21
)
Impairment
 

 

 

 

Foreign currency translation and other
 

 
(2
)
 
1

 
(1
)
Balance at end of period
 
$
161

 
$
144

 
$
161

 
$
144


v3.19.2
Cash and Cash Equivalents and Short-term Investments
6 Months Ended
Jun. 30, 2019
Cash, Cash Equivalents, and Short-term Investments [Abstract]  
Cash and Cash Equivalents and Short-term Investments Cash and Cash Equivalents and Short-term Investments
Cash and cash equivalents include cash balances and all 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 June 30, 2019, Cash and cash equivalents and Short-term investments were $816 million compared to $828 million at December 31, 2018, a decrease of $12 million. Of the total balances, $99 million and $91 million were restricted as to their use at June 30, 2019 and December 31, 2018, respectively. Included within Short-term investments as of June 30, 2019 and December 31, 2018 were £42.8 million ($54.3 million at June 30, 2019 exchange rates) and £42.7 million ($53.9 million at December 31, 2018 exchange rates), respectively, 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.
v3.19.2
Other Financial Data
6 Months Ended
Jun. 30, 2019
Other Financial Data [Abstract]  
Other Financial Data Other Financial Data
Condensed Consolidated Statements of Income Information
Other Income (Expense)
Other income (expense) consists of the following (in millions):
 
Three Months Ended June 30
 
Six Months Ended June 30
 
2019
 
2018
 
2019
 
2018
Foreign currency remeasurement
$
11

 
$
29

 
$

 
$
13

Disposal of businesses
2

 

 
7

 
(1
)
Pension and other postretirement
5

 
(7
)
 
9

 
(5
)
Equity earnings
1

 
1

 
2

 
2

Financial instruments
(13
)
 
(27
)
 
(12
)
 
(27
)
Other

 
1

 

 

Total
$
6

 
$
(3
)
 
$
6

 
$
(18
)

Condensed Consolidated Statements of Financial Position Information
Allowance for Doubtful Accounts
An analysis of the allowance for doubtful accounts are as follows (in millions):
 
Three Months Ended June 30
 
Six Months Ended June 30
 
2019
 
2018
 
2019
 
2018
Balance at beginning of period
$
64

 
$
65

 
$
64

 
$
59

Provision charged to Other general expenses
4

 
3

 
12

 
11

Accounts written off, net of recoveries
(3
)
 
(6
)
 
(11
)
 
(8
)
Balance at end of period
$
65

 
$
62

 
$
65

 
$
62


Other Current Assets
The components of Other current assets are as follows (in millions):
As of
June 30,
2019
 
December 31,
2018
Costs to fulfill contracts with customers (1)
$
216

 
$
329

Prepaid expenses
128

 
97

Taxes receivable
145

 
113

Other (2)
142

 
79

Total
$
631

 
$
618


(1)
Refer to Note 3 “Revenue from Contracts with Customers” for further information.
(2)
December 31, 2018 includes $12 million previously classified as “Receivables from the Divested Business”.
Other Non-Current Assets
The components of Other non-current assets are as follows (in millions):
As of
June 30,
2019
 
December 31,
2018
Costs to obtain contracts with customers (1)
$
161

 
$
156

Taxes receivable
100

 
100

Leases (2)
65

 

Investments
54

 
54

Other
141

 
138

Total
$
521

 
$
448


(1)
Refer to Note 3 “Revenue from Contracts with Customers” for further information.
(2)
Refer to Note 20 “Lease Commitments” for further information.
Other Current Liabilities
The components of Other current liabilities are as follows (in millions):
As of
June 30,
2019
 
December 31,
2018
Deferred revenue (1)
$
337

 
$
251

Leases (2)
223

 

Taxes payable
133

 
83

Other
504

 
602

Total
$
1,197

 
$
936


(1)
During the three and six months ended June 30, 2019, $95 million and $241 million, respectively, was recognized in the Condensed Consolidated Statements of Income. During the three and six months ended June 30, 2018, $115 million and $215 million, respectively, was recognized in the Condensed Consolidated Statements of Income.
(2)
Refer to Note 20 “Lease Commitments” for further information.
Other Non-Current Liabilities
The components of Other non-current liabilities are as follows (in millions):
As of
June 30,
2019
 
December 31,
2018
Taxes payable (1)
$
576

 
$
585

Leases
37

 
169

Deferred revenue
59

 
65

Compensation and benefits
49

 
56

Other
203

 
222

Total
$
924

 
$
1,097


(1) Includes $221 million and $240 million for the non-current portion of the one-time mandatory transition tax on accumulated foreign earnings as of June 30, 2019 and December 31, 2018, respectively.
v3.19.2
Discontinued Operations
6 Months Ended
Jun. 30, 2019
Discontinued Operations and Disposal Groups [Abstract]  
Discontinued Operations Discontinued Operations
On February 9, 2017, the Company entered into a Purchase Agreement with Tempo Acquisition, LLC (the “Purchase Agreement”) to sell its benefits administration and business process outsourcing business (the “Divested Business”) to an entity formed and controlled by affiliates of The Blackstone Group L.P. (the “Buyer”) 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 (the “Transaction”). Cash proceeds after customary adjustments and before taxes due were $4.2 billion.
Aon and the Buyer entered into certain transaction related agreements at the closing, including two commercial agreements, a transition services agreement, certain intellectual property license agreements, subleases, and other customary agreements. Aon expects to continue to be a significant client of the Divested Business and the Divested Business has agreed to use Aon for its broking and other services for a specified period of time.
The financial results of the Divested Business for the three and six months ended June 30, 2019 and 2018 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 Business (in millions):
 
 
Three Months Ended June 30
 
Six Months Ended June 30

 
2019
 
2018
 
2019
 
2018
Expenses
 
 
 
 
 
 
 
 
Total operating expenses
 
$
1

 
$

 
$
1

 
$
3

Loss from discontinued operations before income taxes
 
(1
)
 

 
(1
)
 
(3
)
Income tax benefit
 
(1
)
 

 
(1
)
 
(1
)
Net loss from discontinued operations excluding gain
 

 

 

 
(2
)
Gain on sale of discontinued operations, net of tax
 

 
1

 

 
9

Net income from discontinued operations
 
$

 
$
1

 
$

 
$
7


There were no Cash and cash equivalents of discontinued operations at June 30, 2019. Total proceeds received for the sale of the Divested Business and taxes paid as a result of the sale are recognized on the Condensed Consolidated Statements of Cash Flows in Cash provided by investing activities - continuing operations and Cash provided by operating activities - continuing operations, respectively.
v3.19.2
Restructuring
6 Months Ended
Jun. 30, 2019
Restructuring and Related Activities [Abstract]  
Restructuring Restructuring
In 2017, Aon initiated a global restructuring plan (the “Restructuring Plan”) in connection with the sale of the Divested Business. The Restructuring Plan is intended to streamline operations across the organization and deliver greater efficiency, insight, and connectivity. The Company expects these restructuring activities and related expenses to affect continuing operations through the fourth quarter of 2019, including an estimated 5,000 to 5,600 total role eliminations. In the second quarter of 2019, Aon updated the Restructuring Plan for additional opportunities that were identified in the quarter, which are expected to result in additional estimated charges of $125 million in 2019.
The Restructuring Plan is expected to result in cumulative charges of approximately $1,350 million through the end of the plan, consisting of approximately $530 million in employee termination costs, $130 million in technology rationalization costs, $80 million in lease consolidation costs, $45 million in non-cash asset impairments, and $565 million in other costs, including certain separation costs associated with the sale of the Divested Business.
From the inception of the Restructuring Plan through June 30, 2019, the Company has eliminated 5,091 positions and incurred total charges of $1,200 million for restructuring and related separation costs. These charges are included in Compensation and benefits, Information technology, Premises, Depreciation of fixed assets, and Other general expenses in the accompanying Condensed Consolidated Statements of Income.
The following table summarizes restructuring and separation costs by type that have been incurred through June 30, 2019 and are estimated to be incurred through the end of the Restructuring Plan (in millions). Estimated costs by type may be revised in future periods as these assumptions are updated:
 
 
Three Months Ended June 30, 2019
 
Six Months Ended June 30, 2019
 
Inception to Date
 
Estimated Remaining Costs
 
Estimated Total Cost (1)
Workforce reduction
 
$
78

 
$
102

 
$
516

 
$
14

 
$
530

Technology rationalization (2)
 
4

 
15

 
95

 
35

 
130

Lease consolidation (2)
 
5

 
14

 
50

 
30

 
80

Asset impairments
 
2

 
2

 
41

 
4

 
45

Other costs associated with restructuring and separation (2) (3)
 
38

 
85

 
498

 
67

 
565

Total restructuring and related expenses
 
$
127

 
$
218

 
$
1,200

 
$
150

 
$
1,350

(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. Estimated Total Cost includes $100 million of non-cash charges.
(2)
Total contract termination costs incurred under the Restructuring Plan associated with Technology rationalizations, Lease consolidations, and Other costs, respectively, associated with restructuring and separation were for the three months ended June 30, 2019, $2 million, $4 million, and $1 million; for the six months ended June 30, 2019, were $3 million, $13 million, and $3 million; and since inception of the Restructuring Plan, were $9 million, $46 million, and $91 million. Total estimated contract termination costs expected to be incurred under the Restructuring Plan associated with Technology rationalizations, Lease consolidations, and Other costs associated with restructuring and separation, are $15 million, $80 million, and $95 million, respectively.
(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 June 30, 2019 are as follows (in millions):
 
 
 
Balance as of December 31, 2018
 
$
201

Expensed
 
204

Cash payments
 
(222
)
Foreign currency translation
 
1

Balance as of June 30, 2019
 
$
184


v3.19.2
Acquisitions and Dispositions of Businesses
6 Months Ended
Jun. 30, 2019
Business Combinations [Abstract]  
Acquisitions and Dispositions of Businesses Acquisitions and Dispositions of Businesses
Completed Acquisitions
The Company completed one acquisition during the six months ended June 30, 2019 and five acquisitions during the six months ended June 30, 2018. The following table includes the fair values of consideration transferred, assets acquired, and liabilities assumed as a result of the Company’s acquisitions (in millions):
 
 
Six Months Ended June 30, 2019
Consideration Transferred
 
$
17

Deferred and contingent consideration
 
5

Aggregate consideration transferred
 
$
22

 
 
 
Assets acquired
 
 
Cash and cash equivalents
 
$
2

Goodwill
 
15

Intangible assets, net
 
9

Other assets
 
4

Total assets acquired
 
30

Liabilities assumed
 
 
Current liabilities
 
6

Other non-current liabilities
 
2

Total liabilities assumed
 
8

Net assets acquired
 
$
22


The results of operations of these acquisitions are included in the Financial Statements as of the respective acquisition dates. The Company’s results of operations would not have been materially different if these acquisitions had been reported from the beginning of the period in which they were acquired.
2019 Acquisitions
On January 1, 2019, the Company completed the transaction to acquire Chapka Assurances SAS based in France.
2018 Acquisitions
On May 9, 2018, the Company completed the transaction to acquire certain assets of 601West, a division of Lee & Hayes, P.L.L.C. based in the United States.
On April 24, 2018, the Company completed the transaction to acquire Inspiring Benefits, S.L., a Spain-based firm specialized in employee loyalty, wellbeing, and rewards programs.
On March 1, 2018, the Company completed the transaction to acquire the business and assets of the trade credit business of Niche International Business Proprietary Limited, a trade credit brokerage based in Johannesburg, South Africa.
On March 1, 2018, the Company completed the transaction to acquire Affinity Risk Partners (Brokers) Pty. Ltd., an insurance broker in Victoria, Australia.
On January 19, 2018, the Company completed the transaction to acquire substantially all of the assets of The Burchfield Group, a provider in pharmacy benefit consulting, auditing, and health plan compliance services based in the United States.
Completed Dispositions
The Company completed three dispositions during the three months ended June 30, 2019 and four dispositions during the six months ended June 30, 2019. The Company completed one disposition during the three and six months ended June 30, 2018.
Total pretax gains recognized for the three and six months ended June 30, 2019 were $2 million and $7 million, respectively. There were no pretax gains or losses for the three months ended June 30, 2018 and total pretax losses, net of gains, were $1 million for
the six months ended June 30, 2018. Gains and losses recognized as a result of a disposition are included in Other income (expense) in the Condensed Consolidated Statements of Income.
v3.19.2
Goodwill and Other Intangible Assets
6 Months Ended
Jun. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets
The changes in the net carrying amount of goodwill for the six months ended June 30, 2019 are as follows (in millions):
Balance as of December 31, 2018
$
8,171

Goodwill related to current year acquisitions
15

Goodwill related to disposals
(9
)
Goodwill related to prior year acquisitions
2

Foreign currency translation and other
19

Balance as of June 30, 2019
$
8,198


Other intangible assets by asset class are as follows (in millions):
 
June 30, 2019
 
December 31, 2018
 
Gross Carrying Amount
 
Accumulated
Amortization and Impairment
 
Net Carrying Amount
 
Gross Carrying Amount
 
Accumulated
Amortization and Impairment
 
Net Carrying Amount
Customer related and contract based
$
2,254

 
$
1,517

 
$
737

 
$
2,240

 
$
1,444

 
$
796

Tradenames
1,028

 
847

 
181

 
1,027

 
740

 
287

Technology and other
385

 
330

 
55

 
391

 
325

 
66

Total
$
3,667

 
$
2,694

 
$
973

 
$
3,658

 
$
2,509

 
$
1,149


The estimated future amortization for finite lived intangible assets as of June 30, 2019 is as follows (in millions):
Remainder of 2019
$
192

2020
223

2021
128

2022
87

2023
74

2024
58

Thereafter
211

Total
$
973


v3.19.2
Debt
6 Months Ended
Jun. 30, 2019
Debt Disclosure [Abstract]  
Debt Debt
Notes
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.
On December 3, 2018, Aon Corporation issued $350 million 4.50% Senior Notes due December 2028. The Company used the net proceeds of the offering to pay down a portion of outstanding commercial paper and for general corporate purposes.
On March 8, 2018, the Company’s CAD 375 million ($291 million at March 8, 2018 exchange rates) 4.76% Senior Note due March 2018 issued by a Canadian subsidiary of Aon Corporation matured and was repaid in full.
Revolving Credit Facilities
As of June 30, 2019, Aon plc had two primary committed credit facilities outstanding: its $900 million multi-currency United States (“U.S.”) credit facility expiring in February 2022 and its $400 million multi-currency U.S. credit facility expiring in October 2022 (collectively, the “2022 Facilities”).
Each of these facilities includes customary representations, warranties and covenants, including financial covenants that require Aon to maintain specified ratios of adjusted consolidated earnings before interest, taxes, depreciation, and amortization (“EBITDA”) to consolidated interest expense and consolidated debt to adjusted consolidated EBITDA, in each case, tested quarterly. At June 30, 2019, Aon did not have borrowings under the 2022 Facilities, and was in compliance with the financial covenants and all other covenants contained therein during the rolling twelve months ended June 30, 2019.
Commercial Paper
Aon Corporation, a wholly owned subsidiary of Aon plc, has established a U.S. commercial paper program and Aon plc has established a European multi-currency commercial paper program (collectively, the “CP Programs”). Commercial paper may be issued in aggregate principal amounts of up to $600 million under the U.S. program and €525 million under the European program, not to exceed the amount of the Company’s committed credit, which was $1.3 billion at June 30, 2019. The U.S. commercial paper program is fully and unconditionally guaranteed by Aon plc and the European multi-currency commercial paper program is fully and unconditionally guaranteed by Aon Corporation.
Commercial paper outstanding, which is included in Short-term debt and current portion of long-term debt in the Company’s Condensed Consolidated Statements of Financial Position, is as follows (in millions):
As of
 
June 30, 2019
 
December 31, 2018
Commercial paper outstanding
 
$
843

 
$
250


The weighted average commercial paper outstanding and its related interest rates are as follows (in millions, except percentages):
 
 
Three Months Ended June 30
 
Six Months Ended June 30
 
 
2019
 
2018
 
2019
 
2018
Weighted average commercial paper outstanding
 
$
639

 
$
744

 
482

 
$
437

Weighted average interest rate of commercial paper outstanding
 
0.70
%
 
0.92
%
 
0.63
%
 
0.85
%

v3.19.2
Income Taxes
6 Months Ended
Jun. 30, 2019
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The effective tax rates on net income from continuing operations were 16.3% and 15.9% for the three and six months ended June 30, 2019, respectively. The effective tax rates on net income from continuing operations were 165.5% and (4.8)% for the three and six months ended June 30, 2018, respectively.
For the three and six months ended June 30, 2019, the tax rate was primarily driven by the geographical distribution of income, including restructuring charges, and certain favorable discrete items, primarily the impact of shared-based payments and changes in the assertion for unremitted earnings.
For the three and six months ended June 30, 2018, the tax rate was primarily driven by the geographical distribution of income including restructuring charges, legacy litigation, and the impairment charge related to certain assets and liabilities classified as held for sale. In addition, certain discrete items impacted the 2018 tax rate including the net tax benefit associated with the anticipated sale of certain assets and liabilities classified as held for sale, the impact of share-based payments, changes in uncertain tax positions and the deferred remeasurement related to the anticipated acceleration of contributions to the qualified U.S. pension plan.
v3.19.2
Shareholders' Equity
6 Months Ended
Jun. 30, 2019
Equity [Abstract]  
Shareholders' Equity 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 $5.0 billion in authorized repurchases, and was increased by $5.0 billion in authorized repurchases in each of November 2014 and February 2017 for a total of $15.0 billion in repurchase authorizations.
Under the Repurchase Program, Class A Ordinary Shares may be repurchased through the open market or in privately negotiated transactions, from time to time, based on prevailing market conditions, and will be funded from available capital.
The following table summarizes the Company’s Share Repurchase activity (in millions, except per share data):
 
Three Months Ended June 30
 
Six Months Ended June 30
 
2019
 
2018
 
2019
 
2018
Shares repurchased
5.8

 
2.8

 
6.4

 
6.7

Average price per share
$
183.23

 
$
141.23

 
$
181.07

 
$
141.06

Costs recorded to retained earnings:

 

 
 
 
 
Total repurchase cost
$
1,050

 
$
400

 
$
1,150

 
$
950

Additional associated costs
6

 
2

 
7

 
5

Total costs recorded to retained earnings
$
1,056

 
$
402

 
$
1,157

 
$
955


At June 30, 2019, the remaining authorized amount for share repurchase under the Repurchase Program was $2.8 billion. Under the Repurchase Program, the Company has repurchased a total of 124.6 million shares for an aggregate cost of approximately $12.2 billion.
Net Income Per Share
Weighted average ordinary shares outstanding are as follows (in millions):
 
Three Months Ended June 30
 
Six Months Ended June 30
 
2019
 
2018
 
2019
 
2018
Basic weighted average ordinary shares outstanding
240.6

 
246.0

 
241.4

 
247.2

Dilutive effect of potentially issuable shares
2.2

 
1.4

 
1.8

 
1.6

Diluted weighted average ordinary shares outstanding
242.8

 
247.4

 
243.2

 
248.8


Potentially issuable shares are not included in the computation of diluted net income per share if its inclusion would be antidilutive. There were no shares excluded from the calculation for the three and six months ended June 30, 2019 and June 30, 2018.
Accumulated Other Comprehensive Loss
Changes in Accumulated other comprehensive loss by component, net of related tax, are as follows (in millions):
 
Change in Fair Value of Financial Instruments (1) 
 
Foreign Currency Translation Adjustments
 
Postretirement Benefit Obligation (2)
 
Total
Balance at December 31, 2018
$
(15
)
 
$
(1,319
)
 
$
(2,575
)
 
$
(3,909
)
Other comprehensive income (loss) before reclassifications, net
(8
)
 
28

 
5

 
25

Amounts reclassified from accumulated other comprehensive income:
 
 


 


 


Amounts reclassified from accumulated other comprehensive income
8

 

 
52

 
60

Tax expense
(1
)
 

 
(12
)
 
(13
)
Amounts reclassified from accumulated other comprehensive income, net
7

 

 
40

 
47

Net current period other comprehensive income (loss)
(1
)
 
28

 
45

 
72

Balance at June 30, 2019
$
(16
)
 
$
(1,291
)
 
$
(2,530
)
 
$
(3,837
)
(1)
Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Revenue, Interest expense, and Compensation and benefits in the accompanying Condensed Consolidated Statements of Income. Refer to Note 15 “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).
v3.19.2
Employee Benefits
6 Months Ended
Jun. 30, 2019
Retirement Benefits [Abstract]  
Employee Benefits Employee Benefits
The following table provides the components of the net periodic (benefit) cost recognized in the Condensed Consolidated Statements of Income for Aon’s significant U.K., U.S., and other international pension plans. 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 June 30
 
U.K.
 
U.S.
 
Other
 
2019
 
2018
 
2019
 
2018
 
2019
 
2018
Service cost
$

 
$

 
$

 
$

 
$

 
$

Interest cost
27

 
29

 
27

 
25

 
7

 
7

Expected return on plan assets, net of administration expenses
(48
)
 
(50
)
 
(34
)
 
(36
)
 
(10
)
 
(11
)
Amortization of prior-service cost

 

 

 
1

 

 

Amortization of net actuarial loss
8

 
7

 
14

 
15

 
3

 
3

Net periodic (benefit) cost
(13
)
 
(14
)
 
7

 
5

 

 
(1
)
Loss on pension settlement

 
16

 

 

 

 

Total net periodic (benefit) cost
$
(13
)

$
2


$
7


$
5


$


$
(1
)

 
Six Months Ended June 30
 
U.K.
 
U.S.
 
Other
 
2019
 
2018
 
2019
 
2018
 
2019
 
2018
Service cost
$

 
$

 
$

 
$

 
$

 
$

Interest cost
55

 
58

 
54

 
50

 
14

 
14

Expected return on plan assets, net of administration expenses
(97
)
 
(101
)
 
(68
)
 
(72
)
 
(20
)
 
(23
)
Amortization of prior-service cost
1

 

 
1

 
1

 

 

Amortization of net actuarial loss
15

 
15

 
27

 
30