Shareholders’ Equity

Distributable Reserves

As a company incorporated in England and Wales, Aon is required under U.K. law to have available “distributable reserves” to make share repurchases or pay dividends to shareholders. Distributable reserves may be created through the earnings of the U.K. parent company and, among other methods, through a reduction in share capital approved by the English Companies Court. Distributable reserves are not directly linked to a U.S. GAAP reported amount (e.g., retained earnings). As of December 31, 2017 and 2016, the Company had distributable reserves in excess of $1.2 billion and $1.6 billion, respectively.

Ordinary Shares

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

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

During 2017, the Company repurchased 18.0 million shares at an average price per share of $133.67, for a total cost of $2.4 billion and recorded an additional $12.0 million of costs associated with the repurchases to retained earnings. Included in the 18.0 million shares were 118,000 shares that did not settle until January 2018. These shares were settled at an average price per share of $134.41 and total cost of $15.9 million. During 2016, the Company repurchased 12.2 million shares at an average price per share of $102.66, for a total cost of $1.3 billion and recorded an additional $6 million of costs associated with the repurchases to retained earnings. At December 31, 2017, the remaining authorized amount for share repurchase under the Repurchase Program was $5.4 billion. Under the Repurchase Program, the Company has repurchased a total of 108.2 million shares for an aggregate cost of approximately $9.6 billion.

Net Income Per Share

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



Years ended December 31	2017	2016	2015
Basic weighted-average ordinary shares outstanding	258.5	268.1	280.8
Dilutive effect of potentially issuable shares	2.2	2.2	3.0
Diluted weighted-average ordinary shares outstanding	260.7	270.3	283.8

Potentially issuable shares are not included in the computation of diluted net income per share if their inclusion would be antidilutive. There were no shares excluded from the calculation for in 2017, 2016, or 2015.

Dividends

During 2017, 2016, and 2015, the Company paid dividends of $364 million, $345 million, and $323 million, respectively, to holders of its Class A Ordinary Shares. Dividends paid per Class A Ordinary Share were $1.41, $1.29 and $1.15 for the years ended December 31, 2017, 2016, and 2015 respectively.

Accumulated Other Comprehensive Loss

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



	Change in Fair Value of Financial Instruments ⁽¹⁾			Foreign Currency Translation Adjustments			Postretirement Benefit Obligation ⁽²⁾			Total
Balance at January 1, 2015	$	(17	)	$	(335	)	$	(2,782	)	$	(3,134	)
Other comprehensive income (loss) before reclassifications:
Other comprehensive income (loss) before reclassifications	(4		)	(467		)	82			(389		)
Tax benefit (expense)	1			31			(9		)	23
Other comprehensive income (loss) before reclassifications, net	(3		)	(436		)	73			(366		)
Amounts reclassified from accumulated other comprehensive income (loss):
Amounts reclassified from accumulated other comprehensive income (loss)	11			—			117			128
Tax benefit (expense)	(16		)	—			(35		)	(51		)
Amounts reclassified from accumulated other comprehensive income (loss), net	(5		)	—			82			77
Net current period other comprehensive income (loss)	(8		)	(436		)	155			(289		)
Balance at December 31, 2015	(25		)	(771		)	(2,627		)	(3,423		)
Other comprehensive income (loss) before reclassifications:
Other comprehensive income (loss) before reclassifications	(25		)	(490		)	(276		)	(791		)
Tax benefit (expense)	6			(3		)	74			77
Other comprehensive income (loss) before reclassifications, net	(19		)	(493		)	(202		)	(714		)
Amounts reclassified from accumulated other comprehensive income (loss):
Amounts reclassified from accumulated other comprehensive income (loss)	10			—			322			332
Tax benefit (expense)	(3		)	—			(104		)	(107		)
Amounts reclassified from accumulated other comprehensive income (loss), net	7			—			218			225
Net current period other comprehensive income (loss)	(12		)	(493		)	16			(489		)
Balance at December 31, 2016	(37		)	(1,264		)	(2,611		)	(3,912		)
Other comprehensive income (loss) before reclassifications:
Other comprehensive income (loss) before reclassifications	18			397			(220		)	195
Tax benefit (expense)	(3		)	(5		)	55			47
Other comprehensive income (loss) before reclassifications, net	15			392			(165		)	242
Amounts reclassified from accumulated other comprehensive income (loss):
Amounts reclassified from accumulated other comprehensive income (loss)	(2		)	(7		)	236			227
Tax benefit (expense)	(1		)	—			(52		)	(53		)
Amounts reclassified from accumulated other comprehensive income (loss), net	(3		)	(7		)	184			174
Net current period other comprehensive income (loss)	12			385			19			416
Balance at December 31, 2017	$	(25	)	$	(879	)	$	(2,592	)	$	(3,496	)


(1)	Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Other income (expense), Other general expenses, and Compensation and benefits. See Note 14 “Derivatives and Hedging” for additional information regarding the Company’s derivative and hedging activity.


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