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Guarantee of Registered Securities
 3 Months Ended
Mar. 31, 2019
Guarantee of Registered Securities [Abstract]  
Guarantee of Registered Securities Guarantee of Registered Securities
As described in Note 17 “Claims, Lawsuits, and Other Contingencies,” in connection with the Redomestication, Aon plc entered into various agreements pursuant to which it agreed to guarantee the obligations of Aon Corporation arising under issued and outstanding debt securities, including the 5.00% Notes due September 2020, the 8.205% Notes due January 2027, and the 6.25% Notes due September 2040 (collectively, the “Aon Corporation Notes”). Additionally, Aon plc has guaranteed the obligations of Aon Corporation arising under the 4.50% Senior Notes due 2028. Aon Corporation is a 100% indirectly owned subsidiary of Aon plc. All guarantees of Aon plc are full and unconditional. There are no other subsidiaries of Aon plc that are guarantors of the Aon Corporation Notes.
In addition, Aon Corporation entered into an agreement pursuant to which it guaranteed the obligations of Aon plc arising under the 4.25% Notes due 2042 exchanged for Aon Corporation’s outstanding 8.205% Notes due January 2027, and has also guaranteed the obligations of Aon plc arising under the 4.45% Notes due 2043, the 4.00% Notes due November 2023, the 2.875% Notes due May 2026, the 3.50% Notes due June 2024, the 4.60% Notes due June 2044, the 4.75% Notes due May 2045, the 2.80% Notes due March 2021, and the 3.875% Notes due December 2025 (collectively, the “Aon plc Notes”). In each case, the guarantee of Aon Corporation is full and unconditional. There are no subsidiaries of Aon plc, other than Aon Corporation, that are guarantors of the Aon plc Notes. As a result of the existence of these guarantees, the Company has elected to present the financial information set forth in this footnote in accordance with Rule 3-10 of Regulation S-X.
In the forth quarter of 2018, Aon plc obtained direct ownership in two subsidiaries that were previously indirectly owned by Aon Corporation. In the first quarter of 2019, Aon Corporation obtained indirect ownership of subsidiaries that were previously indirectly owned by Aon plc. The financial results of both subsidiaries are included in the Other Non-Guarantor Subsidiaries column of the Condensed Consolidating Financial Statements. The Company has retrospectively reflected the impact of these transactions on the Condensed Consolidating Statements of Income and Condensed Consolidating Statements of Comprehensive Income for the periods ended March 31, 2018 and the Condensed Consolidated Statement of Financial Position as of December 31, 2018.
The following tables set forth Condensed Consolidating Statements of Income and Condensed Consolidating Statements of Comprehensive Income for the three months ended March 31, 2019 and 2018, Condensed Consolidating Statements of Financial Position as of March 31, 2019 and December 31, 2018, and Condensed Consolidating Statements of Cash Flows for the three months ended March 31, 2019 and 2018 in accordance with Rule 3-10 of Regulation S-X. The Condensed Consolidating Financial
Information includes the accounts of Aon plc, the accounts of Aon Corporation, and the combined accounts of the Other Non-Guarantor Subsidiaries. The Condensed Consolidating Financial Statements are presented in all periods as a merger under common control. The principal consolidating adjustments are to eliminate the investment in subsidiaries and intercompany balances and transactions.
Condensed Consolidating Statement of Income
 
 
Three Months Ended March 31, 2019
(millions)
 
Aon plc
 
Aon Corporation
 
Other Non-Guarantor Subsidiaries
 
Consolidating Adjustments
 
Consolidated
Revenue
 
 
 
 
 
 
 
 
 
 
Total revenue
 
$
—

 
$
—

 
$
3,143

 
$
—

 
$
3,143

Expenses
 
 
 
 
 
 
 
 
 
 
Compensation and benefits
 
20

 
8

 
1,556

 
—

 
1,584

Information technology
 
—

 
—

 
117

 
—

 
117

Premises
 
—

 
4

 
83

 
—

 
87

Depreciation of fixed assets
 
—

 
—

 
40

 
—

 
40

Amortization and impairment of intangible assets
 
—

 
—

 
97

 
—

 
97

Other general expenses (income)
 
—

 
(4
)
 
350

 
—

 
346

Total operating expenses
 
20

 
8

 
2,243

 
—

 
2,271

Operating income (loss)
 
(20
)
 
(8
)
 
900

 
—

 
872

Interest income
 
—

 
9

 
—

 
(7
)
 
2

Interest expense
 
(46
)
 
(28
)
 
(5
)
 
7

 
(72
)
Intercompany interest income (expense)
 
4

 
(116
)
 
112

 
—

 
—

Intercompany other income (expense)
 
31

 
(99
)
 
68

 
—

 
—

Other income (expense)
 
5

 
(11
)
 
8

 
(2
)
 
—

Income (loss) from continuing operations before income taxes
 
(26
)
 
(253
)
 
1,083

 
(2
)
 
802

Income tax expense (benefit)
 
(5
)
 
(42
)
 
173

 
—

 
126

Net income (loss) from continuing operations
 
(21
)
 
(211
)
 
910

 
(2
)
 
676

Net income from discontinued operations
 
—

 
—

 
—

 
—

 
—

Net income (loss) before equity in earnings of subsidiaries
 
(21
)
 
(211
)
 
910

 
(2
)
 
676

Equity in earnings of subsidiaries
 
682

 
724

 
513

 
(1,919
)
 
—

Net income
 
661

 
513

 
1,423

 
(1,921
)
 
676

Less: Net income attributable to noncontrolling interests
 
—

 
—

 
17

 
—

 
17

Net income attributable to Aon shareholders
 
$
661

 
$
513

 
$
1,406

 
$
(1,921
)
 
$
659

Condensed Consolidating Statement of Income
 
 
Three Months Ended March 31, 2018
(millions)
 
Aon plc
 
Aon Corporation
 
Other Non-Guarantor Subsidiaries
 
Consolidating Adjustments
 
Consolidated
Revenue
 
 
 
 
 
 
 
 
 
 
Total revenue
 
$
—

 
$
—

 
$
3,090

 
$
—

 
$
3,090

Expenses
 
 
 
 
 
 
 
 
 
 
Compensation and benefits
 
19

 
1

 
1,596

 
—

 
1,616

Information technology
 
—

 
—

 
115

 
—

 
115

Premises
 
—

 
—

 
93

 
—

 
93

Depreciation of fixed assets
 
—

 
—

 
39

 
—

 
39

Amortization and impairment of intangible assets
 
—

 
—

 
110

 
—

 
110

Other general expenses (income)
 
1

 
—

 
317

 
—

 
318

Total operating expenses
 
20

 
1

 
2,270

 
—

 
2,291

Operating income (loss)
 
(20
)
 
(1
)
 
820

 
—

 
799

Interest income
 
—

 
14

 
—

 
(10
)
 
4

Interest expense
 
(49
)
 
(24
)
 
(7
)
 
10

 
(70
)
Intercompany interest income (expense)
 
4

 
(128
)
 
124

 
—

 
—

Intercompany other income (expense)
 
(53
)
 
(5
)
 
58

 
—

 
—

Other income (expense)
 
(25
)
 
(6
)
 
13

 
3

 
(15
)
Income (loss) from continuing operations before income taxes
 
(143
)
 
(150
)
 
1,008

 
3

 
718

Income tax expense (benefit)
 
(16
)
 
(27
)
 
157

 
—

 
114

Net income (loss) from continuing operations
 
(127
)
 
(123
)
 
851

 
3

 
604

Net income from discontinued operations
 
—

 
—

 
6

 
—

 
6

Net income (loss) before equity in earnings of subsidiaries
 
(127
)
 
(123
)
 
857

 
3

 
610

Equity in earnings of subsidiaries
 
718

 
705

 
582

 
(2,005
)
 
—

Net income
 
591

 
582

 
1,439

 
(2,002
)
 
610

Less: Net income attributable to noncontrolling interests
 
—

 
—

 
16

 
—

 
16

Net income attributable to Aon shareholders
 
$
591

 
$
582

 
$
1,423

 
$
(2,002
)
 
$
594


Condensed Consolidating Statement of Comprehensive Income
 
 
Three Months Ended March 31, 2019
(millions)
 
Aon plc
 
Aon Corporation
 
Other Non-Guarantor Subsidiaries
 
Consolidating Adjustments
 
Consolidated
Net income
 
$
661

 
$
513

 
$
1,423

 
$
(1,921
)
 
$
676

Less: Net income attributable to noncontrolling interests
 
—

 
—

 
17

 
—

 
17

Net income attributable to Aon shareholders
 
661

 
513

 
1,406

 
(1,921
)
 
659

Other comprehensive income, net of tax:
 
 
 
 
 
 
 
 
 
 
Change in fair value of financial instruments
 
—

 
2

 
5

 
—

 
7

Foreign currency translation adjustments
 
—

 
—

 
131

 
2

 
133

Postretirement benefit obligation
 
—

 
22

 
9

 
—

 
31

Total other comprehensive income
 
—

 
24

 
145

 
2

 
171

Equity in other comprehensive income of subsidiaries, net of tax
 
167

 
115

 
139

 
(421
)
 
—

Less: Other comprehensive income attributable to noncontrolling interests
 
—

 
—

 
2

 
—

 
2

Total other comprehensive income attributable to Aon shareholders
 
167

 
139

 
282

 
(419
)
 
169

Comprehensive income attributable to Aon shareholders
 
$
828

 
$
652

 
$
1,688

 
$
(2,340
)
 
$
828

Condensed Consolidating Statement of Comprehensive Income
 
 
Three Months Ended March 31, 2018
(millions)
 
Aon plc
 
Aon Corporation
 
Other Non-Guarantor Subsidiaries
 
Consolidating Adjustments
 
Consolidated
Net income
 
$
591

 
$
582

 
$
1,439

 
$
(2,002
)
 
$
610

Less: Net income attributable to noncontrolling interests
 
—

 
—

 
16

 
—

 
16

Net income attributable to Aon shareholders
 
591

 
582

 
1,423

 
(2,002
)
 
594

Other comprehensive income, net of tax:
 
 
 
 
 
 
 
 
 
 
Change in fair value of financial instruments
 
—

 
3

 
11

 
—

 
14

Foreign currency translation adjustments
 
—

 
—

 
250

 
(3
)
 
247

Postretirement benefit obligation
 
—

 
11

 
37

 
—

 
48

Total other comprehensive income
 
—

 
14

 
298

 
(3
)
 
309

Equity in other comprehensive income of subsidiaries, net of tax
 
309

 
285

 
299

 
(893
)
 
—

Less: Other comprehensive income attributable to noncontrolling interests
 
—

 
—

 
3

 
—

 
3

Total other comprehensive income attributable to Aon shareholders
 
309

 
299

 
594

 
(896
)
 
306

Comprehensive income attributable to Aon shareholders
 
$
900

 
$
881

 
$
2,017

 
$
(2,898
)
 
$
900


Condensed Consolidating Statement of Financial Position
 
 
As of March 31, 2019
(millions)
 
Aon plc
 
Aon Corporation
 
Other Non-Guarantor Subsidiaries
 
Consolidating Adjustments
 
Consolidated
Assets
 
 

 
 

 
 

 
 

 
 

Current assets
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
—

 
$
746

 
$
563

 
$
(709
)
 
$
600

Short-term investments
 
—

 
47

 
87

 
—

 
134

Receivables, net
 
—

 
—

 
3,242

 
—

 
3,242

Fiduciary assets
 
—

 
—

 
11,412

 
—

 
11,412

Current intercompany receivables
 
166

 
2,277

 
12,154

 
(14,597
)
 
—

Other current assets
 
—

 
10

 
521

 
—

 
531

Total current assets
 
166

 
3,080

 
27,979

 
(15,306
)
 
15,919

Goodwill
 
—

 
—

 
8,219

 
—

 
8,219

Intangible assets, net
 
—

 
—

 
1,077

 
—

 
1,077

Fixed assets, net
 
—

 
—

 
606

 
—

 
606

Operating lease right-of-use assets
 
—

 
114

 
879

 
—

 
993

Deferred tax assets
 
94

 
488

 
150

 
(144
)
 
588

Prepaid pension
 
—

 
5

 
1,219

 
—

 
1,224

Non-current intercompany receivables
 
401

 
262

 
7,202

 
(7,865
)
 
—

Other non-current assets
 
1

 
30

 
478

 
—

 
509

Investment in subsidiary
 
9,283

 
19,919

 
(355
)
 
(28,847
)
 
—

Total assets
 
$
9,945

 
$
23,898

 
$
47,454

 
$
(52,162
)
 
$
29,135

 
 
 
 
 
 
 
 
 
 
 
Liabilities and equity
 
 

 
 

 
 

 
 

 
 

Liabilities
 
 
 
 
 
 
 
 
 
 
Current liabilities
 
 
 
 
 
 
 
 
 
 
Accounts payable and accrued liabilities
 
$
351

 
$
75

 
$
1,762

 
$
(709
)
 
$
1,479

Short-term debt and current portion of long-term debt
 
248

 
175

 
3

 
—

 
426

Fiduciary liabilities
 
—

 
—

 
11,412

 
—

 
11,412

Current intercompany payables
 
339

 
13,283

 
975

 
(14,597
)
 
—

Other current liabilities
 
—

 
81

 
1,139

 
—

 
1,220

Total current liabilities
 
938

 
13,614

 
15,291

 
(15,306
)
 
14,537

Long-term debt
 
4,228

 
1,762

 
—

 
—

 
5,990

Non-current operating lease liabilities
 
—

 
153

 
825

 
—

 
978

Deferred tax liabilities
 
—

 
—

 
349

 
(144
)
 
205

Pension, other postretirement and postemployment liabilities
 
—

 
1,241

 
349

 
—

 
1,590

Non-current intercompany payables
 
—

 
7,368

 
497

 
(7,865
)
 
—

Other non-current liabilities
 
4

 
115

 
854

 
—

 
973

Total liabilities
 
5,170

 
24,253

 
18,165

 
(23,315
)
 
24,273

 
 
 
 
 
 
 
 
 
 
 
Equity
 
 
 
 
 
 
 
 
 
 
Total Aon shareholders’ equity
 
4,775

 
(355
)
 
29,202

 
(28,847
)
 
4,775

Noncontrolling interests
 
—

 
—

 
87

 
—

 
87

Total equity
 
4,775

 
(355
)
 
29,289

 
(28,847
)
 
4,862

Total liabilities and equity
 
$
9,945

 
$
23,898

 
$
47,454

 
$
(52,162
)
 
$
29,135

Condensed Consolidating Statement of Financial Position
 
 
As of December 31, 2018
(millions)
 
Aon plc
 
Aon Corporation
 
Other Non-Guarantor Subsidiaries
 
Consolidating Adjustments
 
Consolidated
Assets
 
 

 
 

 
 

 
 

 
 

Current assets
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
—

 
$
862

 
$
575

 
$
(781
)
 
$
656

Short-term investments
 
—

 
56

 
116

 
—

 
172

Receivables, net
 
—

 
—

 
2,760

 
—

 
2,760

Fiduciary assets
 
—

 
—

 
10,166

 
—

 
10,166

Current intercompany receivables
 
191

 
897

 
11,634

 
(12,722
)
 
—

Other current assets
 
—

 
16

 
602

 
—

 
618

Total current assets
 
191

 
1,831

 
25,853

 
(13,503
)
 
14,372

Goodwill
 
—

 
—

 
8,171

 
—

 
8,171

Intangible assets, net
 
—

 
—

 
1,149

 
—

 
1,149

Fixed assets, net
 
—

 
—

 
588

 
—

 
588

Operating lease right-of-use assets
 
—

 
—

 
—

 
—

 
—

Deferred tax assets
 
94

 
467

 
144

 
(144
)
 
561

Prepaid pension
 
—

 
5

 
1,128

 
—

 
1,133

Non-current intercompany receivables
 
403

 
261

 
7,225

 
(7,889
)
 
—

Other non-current assets
 
1

 
30

 
417

 
—

 
448

Investment in subsidiary
 
8,433

 
19,132

 
(882
)
 
(26,683
)
 
—

Total assets
 
$
9,122

 
$
21,726

 
$
43,793

 
$
(48,219
)
 
$
26,422

 
 
 
 
 
 
 
 
 
 
 
Liabilities and equity
 
 

 
 

 
 

 
 

 
 

Liabilities
 
 
 
 
 
 
 
 
 
 
Current liabilities
 
 
 
 
 
 
 
 
 
 
Accounts payable and accrued liabilities
 
$
274

 
$
70

 
$
2,380

 
$
(781
)
 
$
1,943

Short-term debt and current portion of long-term debt
 
250

 
—

 
1

 
—

 
251

Fiduciary liabilities
 
—

 
—

 
10,166

 
—

 
10,166

Current intercompany payables
 
213

 
11,875

 
634

 
(12,722
)
 
—

Other current liabilities
 
—

 
69

 
867

 
—

 
936

Total current liabilities
 
737

 
12,014

 
14,048

 
(13,503
)
 
13,296

Long-term debt
 
4,231

 
1,762

 
—

 
—

 
5,993

Non-current operating lease liabilities
 
—

 
—

 
—

 
—

 
—

Deferred tax liabilities
 
—

 
—

 
325

 
(144
)
 
181

Pension, other postretirement and postemployment liabilities
 
—

 
1,275

 
361

 
—

 
1,636

Non-current intercompany payables
 
—

 
7,390

 
499

 
(7,889
)
 
—

Other non-current liabilities
 
3

 
167

 
927

 
—

 
1,097

Total liabilities
 
4,971

 
22,608

 
16,160

 
(21,536
)
 
22,203

 
 
 
 
 
 
 
 
 
 
 
Equity
 
 
 
 
 
 
 
 
 
 
Total Aon shareholders’ equity
 
4,151

 
(882
)
 
27,565

 
(26,683
)
 
4,151

Noncontrolling interests
 
—

 
—

 
68

 
—

 
68

Total equity
 
4,151

 
(882
)
 
27,633

 
(26,683
)
 
4,219

Total liabilities and equity
 
$
9,122

 
$
21,726

 
$
43,793

 
$
(48,219
)
 
$
26,422


Condensed Consolidating Statement of Cash Flows
 
 
Three Months Ended March 31, 2019
(millions)
 
Aon plc
 
Aon
Corporation
 
Other
Non-Guarantor
Subsidiaries
 
Consolidating
Adjustments
 
Consolidated
Cash flows from operating activities
 
 
 
 
 
 
 
 
 
 
Cash provided by (used for) operating activities
 
$
(11
)
 
$
(34
)
 
$
179

 
$
(60
)
 
$
74

 
 
 
 
 
 
 
 
 
 
 
Cash flows from investing activities
 
 
 
 
 
 
 
 
 
 
Proceeds from investments
 
—

 
8

 
4

 
—

 
12

Payments for investments
 
—

 
(9
)
 
(5
)
 
—

 
(14
)
Net sales of short-term investments - non-fiduciary
 
—

 
9

 
32

 
—

 
41

Acquisition of businesses, net of cash acquired
 
—

 
—

 
(15
)
 
—

 
(15
)
Sale of businesses, net of cash sold
 
—

 
—

 
6

 
—

 
6

Capital expenditures
 
—

 
—

 
(57
)
 
—

 
(57
)
Cash provided by (used for) investing activities
 
—

 
8

 
(35
)
 
—

 
(27
)
 
 
 
 
 
 
 
 
 
 
 
Cash flows from financing activities
 
 
 
 
 
 
 
 
 
 
Share repurchase
 
(100
)
 
—

 
—

 
—

 
(100
)
Advances from (to) affiliates
 
305

 
(265
)
 
(172
)
 
132

 
—

Issuance of shares for employee benefit plans
 
(98
)
 
—

 
—

 
—

 
(98
)
Issuance of debt
 
384

 
485

 
2

 
—

 
871

Repayment of debt
 
(384
)
 
(310
)
 
—

 
—

 
(694
)
Cash dividends to shareholders
 
(96
)
 
—

 
—

 
—

 
(96
)
Noncontrolling interests and other financing activities
 
—

 
—

 
(23
)
 
—

 
(23
)
Cash provided by (used for) financing activities
 
11

 
(90
)
 
(193
)
 
132

 
(140
)
 
 
 
 
 
 
 
 
 
 
 
Effect of exchange rate changes on cash and cash equivalents
 
—

 
—

 
37

 
—

 
37

Net increase (decrease) in cash and cash equivalents
 
—

 
(116
)
 
(12
)
 
72

 
(56
)
Cash and cash equivalents at beginning of period
 
—

 
862

 
575

 
(781
)
 
656

Cash and cash equivalents at end of period
 
$
—

 
$
746

 
$
563

 
$
(709
)
 
$
600


Condensed Consolidating Statement of Cash Flows
 
 
Three Months Ended March 31, 2018
(millions)
 
Aon plc
 
Aon
Corporation
 
Other
Non-Guarantor
Subsidiaries
 
Consolidating
Adjustments
 
Consolidated
Cash flows from operating activities
 
 
 
 
 
 
 
 
 
 
Cash provided by (used for) operating activities
 
$
(21
)
 
$
626

 
$
277

 
$
(742
)
 
$
140

 
 
 
 
 
 
 
 
 
 
 
Cash flows from investing activities
 
 
 
 
 
 
 
 
 
 
Proceeds from investments
 
—

 
10

 
7

 
—

 
17

Payments for investments
 
(1
)
 
(5
)
 
(6
)
 
1

 
(11
)
Net sales of short-term investments - non-fiduciary
 
—

 
355

 
60

 
—

 
415

Acquisition of businesses, net of cash acquired
 
—

 
—

 
(29
)
 
—

 
(29
)
Sale of businesses, net of cash sold
 
—

 
—

 
(1
)
 
—

 
(1
)
Capital expenditures
 
—

 
—

 
(45
)
 
—

 
(45
)
Cash provided by (used for) investing activities
 
(1
)
 
360

 
(14
)
 
1

 
346

 
 
 
 
 
 
 
 
 
 
 
Cash flows from financing activities
 
 
 
 
 
 
 
 
 
 
Share repurchase
 
(569
)
 
—

 
—

 
—

 
(569
)
Advances from (to) affiliates
 
418

 
(933
)
 
(142
)
 
657

 
—

Issuance of shares for employee benefit plans
 
(109
)
 
—

 
—

 
—

 
(109
)
Issuance of debt
 
431

 
375

 
2

 
—

 
808

Repayment of debt
 
(61
)
 
(349
)
 
(294
)
 
—

 
(704
)
Cash dividends to shareholders
 
(89
)
 
—

 
—

 
—

 
(89
)
Noncontrolling interests and other financing activities
 
—

 
—

 
—

 
—

 
—

Cash provided by (used for) financing activities
 
21

 
(907
)
 
(434
)
 
657

 
(663
)
 
 
 
 
 
 
 
 
 
 
 
Effect of exchange rate changes on cash and cash equivalents
 
—

 
—

 
18

 
—

 
18

Net increase (decrease) in cash and cash equivalents
 
(1
)
 
79

 
(153
)
 
(84
)
 
(159
)
Cash and cash equivalents at beginning of period
 
1

 
2,524

 
793

 
(2,562
)
 
756

Cash and cash equivalents at end of period
 
$
—

 
$
2,603

 
$
640

 
$
(2,646
)
 
$
597