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Aon plc - Quarter Report: 2024 June (Form 10-Q)

CODMChief Operating Decision MakerDCFDiscounted Cash FlowE&OErrors and OmissionsEBITDAEarnings Before Interest, Taxes, Depreciation, and AmortizationEMEAEurope, the Middle East, and AfricaESGEnvironmental, Social, and GovernanceFCAFinancial Conduct AuthorityGAAPGenerally Accepted Accounting PrinciplesGHGGreenhouse GasLOCLetter of CreditOECDOrganisation for Economic Co-operation and DevelopmentROURight-of-UseSECSecurities and Exchange CommissionU.K.United KingdomU.S.United States


Part I Financial Information
Item 1. Financial Statements

Aon plc
Condensed Consolidated Statements of Income
(Unaudited)
 Three Months Ended June 30,Six Months Ended June 30,
(millions, except per share data)2024202320242023
Revenue    
Total revenue$ $ $ $ 
Expenses 
Compensation and benefits    
Information technology    
Premises    
Depreciation of fixed assets    
Amortization and impairment of intangible assets    
Other general expense    
Accelerating Aon United Program expenses    
Total operating expenses    
Operating income    
Interest income    
Interest expense()()()()
Other income (expense) () ()
Income before income taxes    
Income tax expense    
Net income    
Less: Net income attributable to redeemable and non-redeemable noncontrolling interests    
Net income attributable to Aon shareholders$ $ $ $ 
Basic net income per share attributable to Aon shareholders$ $ $ $ 
Diluted net income per share attributable to Aon shareholders$ $ $ $ 
Weighted average ordinary shares outstanding - basic    
Weighted average ordinary shares outstanding - diluted    
See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).
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Aon plc
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)
 Three Months Ended June 30,Six Months Ended June 30,
(millions)2024202320242023
Net income$ $ $ $ 
Less: Net income attributable to redeemable and non-redeemable noncontrolling interests    
Net income attributable to Aon shareholders    
Other comprehensive income, net of tax:   
Change in fair value of financial instruments    
Foreign currency translation adjustments() () 
Postretirement benefit obligation    
Total other comprehensive income (loss) () () 
Less: Other comprehensive income attributable to noncontrolling interests    
Total other comprehensive income (loss) attributable to Aon shareholders() () 
Comprehensive income attributable to Aon shareholders$ $ $ $ 
See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).
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Aon plc
Condensed Consolidated Statements of Financial Position
(Unaudited)
(millions, except nominal value)June 30,
2024		December 31,
2023
Assets  
Current assets  
Cash and cash equivalents$ $ 
Short-term investments  
Receivables, net  
Fiduciary assets
  
Other current assets  
Total current assets  
Goodwill  
Intangible assets, net  
Fixed assets, net  
Operating lease right-of-use assets  
Deferred tax assets  
Prepaid pension  
Other non-current assets  
Total assets$ $ 
Liabilities, redeemable noncontrolling interests, and equity (deficit)  
Liabilities  
Current liabilities  
Accounts payable and accrued liabilities$ $ 
Short-term debt and current portion of long-term debt  
Fiduciary liabilities  
Other current liabilities  
Total current liabilities  
Long-term debt  
Non-current operating lease liabilities  
Deferred tax liabilities  
Pension, other postretirement, and postemployment liabilities  
Other non-current liabilities  
Total liabilities  
Redeemable noncontrolling interests  
Equity (deficit)  
Ordinary shares - $ nominal value
     Authorized: shares (issued: 2024 - ; 2023 - )
  
Additional paid-in capital  
Accumulated deficit()()
Accumulated other comprehensive loss()()
Total Aon shareholders' equity (deficit) ()
Nonredeemable noncontrolling interests  
Total equity (deficit) ()
Total liabilities, redeemable noncontrolling interests and equity (deficit)$ $ 
See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).
8

Aon plc
Condensed Consolidated Statements of Shareholders’ Equity (Deficit)
(Unaudited) 
(millions)SharesOrdinary
Shares and
Additional
Paid-in Capital		Accumulated DeficitAccumulated 
Other
Comprehensive
Loss, Net of Tax		Non-
redeemable
Non-
controlling
Interests		Total
Balance at January 1, 2024 $ $()$()$ $()
Net income— —  —   
Shares issued - employee stock compensation plans ()— — — ()
Shares repurchased()— ()— — ()
Share-based compensation expense—  — — —  
Dividends to shareholders ($ per share)
— — ()— — ()
Net change in fair value of financial instruments— — —  —  
Net foreign currency translation adjustments— — — ()— ()
Net postretirement benefit obligation— — —  —  
Purchases of subsidiary shares from nonredeemable noncontrolling interests— ()— — — ()
Dividends paid to nonredeemable noncontrolling interests on subsidiary common stock— — — — ()()
Balance at March 31, 2024 $ $()$()$ $()
Net income (1)
— —  —   
Shares issued - NFP Transaction  — — —  
Shares issued - employee stock compensation plans ()— — — ()
Shares repurchased()— ()— — ()
Share-based compensation expense—  — — —  
Dividends to shareholders ($ per share)
— — ()— — ()
Net change in fair value of financial instruments— — —  —  
Net foreign currency translation adjustments— — — ()— ()
Net postretirement benefit obligation— — —  —  
Purchases of subsidiary shares from nonredeemable noncontrolling interests— — — —   
Dividends paid to nonredeemable noncontrolling interests on subsidiary common stock— — — — ()()
Adjustments to redeemable noncontrolling interests— ()— — — ()
Balance at June 30, 2024 $ $()$()$ $ 
(1) million for the quarter ended June 30, 2024, which included $ million of Net income related to redeemable noncontrolling interests.
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(millions)SharesOrdinary
Shares and
Additional
Paid-in Capital		Accumulated DeficitAccumulated 
Other
Comprehensive
Loss, Net of Tax		Non-redeemable Non-
controlling
Interests		Total
Balance at January 1, 2023 $ $()$()$ $()
Net income— —  —   
Shares issued - employee stock compensation plans ()()— — ()
Shares repurchased()— ()— — ()
Share-based compensation expense—  — — —  
Dividends to shareholders ($ per share)
— — ()— — ()
Net change in fair value of financial instruments— — —  —  
Net foreign currency translation adjustments— — —  —  
Net postretirement benefit obligation— — —  —  
Dividends paid to noncontrolling interests on subsidiary common stock— — — — ()()
Balance at March 31, 2023 $ $()$()$ $ 
Net income— —  —   
Shares issued - employee stock compensation plans ()— — — ()
Shares repurchased()— ()— — ()
Share-based compensation expense—  — — —  
Dividends to shareholders ($ per share)
— — ()— — ()
Net change in fair value of financial instruments— — —  —  
Net foreign currency translation adjustments— — —  —  
Net postretirement benefit obligation— — —  —  
Purchases of subsidiary shares from noncontrolling interests— ()— — ()()
Dividends paid to noncontrolling interests on subsidiary common stock— — — — ()()
Balance at June 30, 2023 $ $()$()$ $ 
See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).
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Aon plc
Condensed Consolidated Statements of Cash Flows
(Unaudited)
 Six Months Ended June 30,
(millions)20242023
Cash flows from operating activities  
Net income$ $ 
Adjustments to reconcile net income to cash provided by operating activities:  
Gain from sales of businesses() 
Depreciation of fixed assets  
Amortization and impairment of intangible assets  
Share-based compensation expense  
Deferred income taxes()()
Other, net() 
Change in assets and liabilities:  
Receivables, net()()
Accounts payable and accrued liabilities()()
Accelerating Aon United Program liabilities  
Current income taxes  
Pension, other postretirement and postemployment liabilities()()
Other assets and liabilities  
Cash provided by operating activities
  
Cash flows from investing activities  
Proceeds from investments  
Purchases of investments()()
Net sales of short-term investments - non fiduciary  
Acquisition of businesses, net of cash and funds held on behalf of clients()()
Sale of businesses, net of cash and funds held on behalf of clients  
Capital expenditures()()
Cash provided by (used for) investing activities
() 
Cash flows from financing activities  
Share repurchase()()
Proceeds from issuance of shares  
Cash paid for employee taxes on withholding shares()()
Commercial paper issuances, net of repayments()()
Issuance of debt  
Repayment of debt() 
Increase in fiduciary liabilities, net of fiduciary receivables  
Cash dividends to shareholders()()
Redeemable and non-redeemable noncontrolling interests, and other financing activities()()
Cash provided by (used for) financing activities
 ()
Effect of exchange rates on cash and cash equivalents and funds held on behalf of clients() 
Net increase in cash and cash equivalents and funds held on behalf of clients  
Cash, cash equivalents and funds held on behalf of clients at beginning of period  
Cash, cash equivalents and funds held on behalf of clients at end of period$ $ 
Reconciliation of cash and cash equivalents and funds held on behalf of clients:
Cash and cash equivalents$ $ 
Cash and cash equivalents and funds held on behalf of clients classified as held for sale  
Funds held on behalf of clients  
Total cash and cash equivalents and funds held on behalf of clients$ $ 
Supplemental disclosures:  
Interest paid$ $ 
Income taxes paid, net of refunds$ $ 
See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).
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Notes to Condensed Consolidated Financial Statements (Unaudited)
1.
2.
12

% of the Company’s Total assets on the Condensed Consolidated Statements of Financial Position for the period ended June 30, 2024.
Aon holds a controlling financial interest in entities that are not VIEs when it, directly or indirectly holds more than 50% of the voting rights and the noncontrolling interest holders do not hold substantive participating rights.
Securities and Exchange Commission Final Rules
The Enhancement and Standardization of Climate-Related Disclosures for Investors
In March 2024, the SEC adopted final rules to enhance and standardize climate-related disclosures. The final rules will require the Company to provide certain climate-related information in Item 7, Management’s Discussion and Analysis regarding material climate-related risks, activities to mitigate or adapt to such risks, information regarding oversight and management of climate-related risks, information on climate-related targets or goals, and disclosure of Scope 1 and 2 GHG emissions. Additionally, within the Notes to Consolidated Financial Statements, the Company will be required to disclose the financial statement effects of severe weather events and other natural conditions. The final rules are effective for Aon for the year ended December 31, 2025, with the exception of GHG emissions disclosures which are effective for Aon for the year ended December 31, 2026. After the adoption of the final rules, the final rules became subject to several legal challenges, and on April 4, 2024 the SEC voluntarily stayed the final rules pending judicial review. The Company is currently evaluating the impact that the guidance will have on our disclosures and will monitor the judicial process for impacts on the disclosure requirements.
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3.
 $ $ $ Reinsurance Solutions    Health Solutions    Wealth Solutions    Eliminations()()()()Total revenue$ $ $ $ 
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,
2024202320242023
United States$ $ $ $ 
Americas other than United States    
United Kingdom    
Ireland    
Europe, Middle East, & Africa other than United Kingdom and Ireland    
Asia Pacific    
Total revenue$ $ $ $ 
Contract Costs
 $ $ $ Additions    Amortization()()()()Impairment    Foreign currency translation and other() () Balance at end of period$ $ $ $ 
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,
2024202320242023
Balance at beginning of period$ $ $ $ 
Additions    
Amortization()()()()
Impairment    
Foreign currency translation and other() () 
Balance at end of period$ $ $ $ 

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4.
restructuring program called the Accelerating Aon United Program (the “Program”) with the purpose of streamlining the Company’s technology infrastructure, optimizing its leadership structure and resource alignment, and reducing its real estate footprint to align to its hybrid working strategy. The Program includes technology-related costs to facilitate streamlining and simplifying operations, headcount reduction costs, and costs associated with asset impairments, including real estate consolidation and technology costs.
Program charges are recognized within Accelerating Aon United Program expenses on the accompanying Condensed Consolidated Statements of Income and consists of the following cost activities:
•Technology and other – includes costs associated with actions taken to rationalize certain applications and to optimize technology across the Company. These costs may include contract termination fees and other non-capitalizable costs associated with Program initiatives, which include professional service fees.
•Workforce optimization – includes costs associated with headcount reduction and other separation-related costs.
•Asset impairments – includes non-cash costs associated with impairment of assets, as they are identified, including ROU lease assets, leasehold improvements, and other capitalized assets no longer providing economic benefit.
The Program is currently expected to result in cumulative costs of approximately $ billion, consisting of approximately $ million of cash charges and approximately $ million of non-cash charges. For the three and six months ended June 30, 2024, total Program costs incurred were $ million and $ million, respectively. The Company expects to continue to review the implementation of elements of the Program throughout the course of the Program and, therefore, there may be changes to expected timing, estimates of expected costs, and related savings.
The Company’s unpaid liabilities for charges under the Program are generally included in Accounts payable and accrued liabilities in the Condensed Consolidated Statements of Financial Position.
 $ $ $ Charges    Cash payments()() ()Foreign currency translation and other () ()
Non-cash charges (1)
()()()()
Liability balance as of June 30, 2024
$ $ $ $ Total costs incurred from inception to date$ $ $ $ 
 million and $ million, respectively, of accelerated ROU asset amortization or impairments due to the Company’s decision to exit certain leased properties as a result of the AAU Program. The amounts are presented in Technology and other, where the corresponding liability is reflected within Other current liabilities and Non-current operating lease liabilities, which will ultimately be settled in cash.
5.
billion compared to $ billion at December 31, 2023. Of the total balances, $ million and $ million were restricted as to their use at June 30, 2024 and December 31, 2023, respectively. Included within Short-term investments as of June 30, 2024 and December 31, 2023, were £ million ($ million at June 30, 2024 exchange rates) and £ million ($ million at December 31, 2023 exchange rates), respectively, of operating funds required to be held by the Company in the U.K. by the FCA, a U.K.-based regulator.
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6.
 $ $ $ Foreign currency remeasurement () ()Equity earnings ()  Pension and other postretirement()()()()Extinguishment of debt() () 
Financial instruments and other (1)
()   
Total
$ $()$ $()
 million
Condensed Consolidated Statements of Financial Position Information
Allowance for Doubtful Accounts
 $ $ $ Provision    Accounts written off, net of recoveries ()()()Foreign currency translation and other  () Balance at end of period$ $ $ $ 
Other Current Assets
 $ 
Costs to fulfill contracts with customers (2)
  Prepaid expenses  Taxes receivable  Other  Total$ $ 
(1)Refer to Note 7 “Acquisitions and Dispositions of Businesses” for further information.
(2)Refer to Note 3 “Revenue from Contracts with Customers” for further information.
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 $ Taxes receivable  Investments  Leases  Other  Total$ $ 
(1)Refer to Note 3 “Revenue from Contracts with Customers” for further information.
Other Current Liabilities
 $ Taxes payable  Leases  Contingent consideration  
Liabilities held for sale (2)
  Other  
Total
$ $ 
(1)During the three and six months ended June 30, 2024, revenue of $ million and $ million, respectively, was recognized in the Condensed Consolidated Statements of Income. During the three and six months ended June 30, 2023, revenue of $ million and $ million, respectively, was recognized in the Condensed Consolidated Statements of Income.
(2)Refer to Note 7 “Acquisitions and Dispositions of Businesses” for further information.
Other Non-Current Liabilities
 $ Contingent consideration  Compensation and benefits  Deferred revenue  Leases  Other  
Total
$ $ 
(1)Includes $ million for the non-current portion of the one-time mandatory transition tax on accumulated foreign earnings as of December 31, 2023.
17

7.
acquisitions during the three and six months ended June 30, 2024 and acquisition during the three and six months ended June 30, 2023.
On April 25, 2024 (the “Acquisition Date”), the Company completed the acquisition of NFP (the “NFP Transaction”), a leading middle market property and casualty broker, benefits consultant, wealth manager, and retirement plan advisor, with more than colleagues. The Transaction expands Aon’s presence in the large and fast-growing middle-market and enhances NFP’s strong existing client relationships and distribution, by bringing Aon’s data and analytics-based content, capabilities, and expertise, delivered through the Aon Business Services platform.
2024 Acquisitions
On June 18, 2024, the Company completed the acquisition of % of the share capital of Southern Insurance Agency, L.L.C., a U.S.-based insurance and financial services business.
On June 13, 2024, the Company completed the acquisition of % of the share capital of Sean Barrett Bloodstock Insurance Limited, an Ireland-based insurance brokerage.
On May 31, 2024, the Company completed the acquisition of % of the share capital of Walden Wealth Partners LLC., a U.S.-based registered investment advisor firm.
On May 31, 2024, the Company completed the acquisition of % of the share capital of the Morley Agency, Inc., a U.S.-based commercial and person lines P&C insurance broker.
On May 2, 2024, the Company completed the acquisition of % of the share capital of Honest Employment Law Practice Ltd., a U.K.-based business that provides consulting and outsourcing services.
On April 26, 2024, the Company completed the acquisition of % of the share capital of NOVABROK Correduría de Seguros, S.L., a Spain-based insurance broker.
On April 25, 2024, the Company completed the acquisition of % of the share capital of NFP Intermediate Holdings A Corp. (“NFP”), a leading middle market property and casualty broker, benefits consultant, wealth manager, and retirement plan advisor.
On April 3, 2024, the Company completed the acquisition of % of the share capital of Global Insurance Brokers Private Limited, an India-based broker that delivers risk management, insurance, and reinsurance broking services.
Acquisition of NFP
The Company acquired % of the outstanding equity interests of NFP Intermediate Holdings A Corp. in a cash-and-stock merger for an aggregate preliminary purchase price totaling $ billion, including approximately $ billion used to settle indebtedness of NFP and cash consideration to the selling shareholders, and approximately  million class A ordinary shares with a fair value of approximately $ billion, based on the Company’s closing stock price on April 25, 2024. As part of the NFP Transaction, the Company acquired certain less-than-wholly owned entities, resulting in the recognition of noncontrolling interests which are described further below.
The Company financed the NFP Transaction, in part, with the net proceeds from Senior Notes issued on March 1, 2024 totaling to an aggregate amount of $ billion and proceeds from a $ billion delayed draw term loan which was drawn on April 25, 2024. Refer to Note 9 “Debt” for further information.
18

 $ $ Deferred and contingent consideration   Class A ordinary shares issued   Aggregate consideration transferred$ $ $ Assets acquired:Cash and cash equivalents$ $ $ Receivables   
Fiduciary assets (1)
   Goodwill   Other intangible assets: Customer-related and contract-based   Tradenames   Technology and other   Operating lease right-of-use assets   Current assets    Non-current assets   Total assets acquired   Liabilities assumed:Accounts payable and accrued liabilities$ $ $ Fiduciary liabilities   Current liabilities   Long-term debt   Non-current operating lease liabilities   Deferred tax liabilities   Non-current liabilities   Total liabilities assumed   Less: Fair value of redeemable noncontrolling interests () ()Less: Fair value of nonredeemable noncontrolling interests () ()Net assets acquired$ $ $ 
 million of funds held on behalf of clients.
The purchase price related to the NFP Transaction exceeded the estimated fair value of the tangible and identifiable intangible assets acquired and liabilities assumed and, as a result of the purchase allocation, the Company recorded goodwill of approximately $ billion, which is fully allocated to the Aon United segment and is not deductible for tax purposes. The goodwill recognized is attributable primarily to anticipated growth opportunities and synergies as a result of the NFP Transaction which provides the Company with an expanded presence in the large and fast-growing middle-market.
The fair value of the tangible assets and liabilities acquired in the NFP Transaction approximated their carrying values as of the Acquisition Date. The Company used independent third-party valuation specialists to assist in determining the fair value of
19

years based upon the estimated economic benefits received.
•Tradename: The fair value was estimated based on a relief from royalty method of the income approach, considering publicly available third-party trade name royalty rates as well as expected revenue generated by the use of the tradename over its anticipated life. The trade name is amortized over years based upon the estimated economic benefits received.
•Technology: The fair value was estimated based on a replacement cost method of the cost approach which estimates the cost the Company would incur in rebuilding the technology. The technology is amortized over years based upon the estimated economic benefits received.
•Contingent Consideration: The fair value of assumed contingent consideration was estimated based on a Monte Carlo simulation in a risk-neutral framework. Key assumptions for estimating fair value include projected revenue or EBITDA, as well as the discount rate and volatility associated with the relevant metric. Contingent consideration liabilities are classified as Level 3 because of the Company’s reliance on unobservable inputs.
The estimates described above directly impact the amount of identified intangible assets recognized and the related amortization expense in future periods as well as certain liabilities assumed. Intangible assets acquired had a weighted average useful economic life of years. As of June 30, 2024, the aggregate intangible assets relating to the NFP Transaction of approximately $ billion were recorded in Intangible assets, net on the Condensed Consolidated Balance Sheets. These amounts are considered preliminary and, therefore, the Company may refine estimates and adjust the assets acquired and liabilities assumed over a measurement period, not to exceed one year from the Acquisition Date. These adjustments are made in the period in which the amounts are determined, and the current period income effect of such adjustments will be calculated as if the adjustments had been completed as of the Acquisition Date.
For the three and six months ended June 30, 2024, the Company recognized $ million and $ million, respectively, of transaction costs in Other general expenses. Additional transaction costs include $ million of debt extinguishment charges recognized in Other income (expense) for the three and six months ended June 30, 2024 in connection with the extinguishment of assumed long-term debt through cash tender offers on April 26, 2024.
The Company’s Condensed Consolidated Financial Statements for the three and six months ended June 30, 2024 include the operations of NFP from the Acquisition Date.
 Net loss attributable to Aon shareholders$()
Supplemental Pro Forma Combined Information (Unaudited)
The following unaudited pro forma combined financial information presents the combined results of operations of the Company as if the NFP Transaction occurred on January 1, 2023.
 $ $ $ Net income attributable to Aon shareholders    
20

% of the share capital of Gi&Bi S.r.l., an Italy-based insurance broker specialized in the agricultural business segment.
On August 30, 2023, the Company completed the acquisition of % of the share capital of NGS (Uruguay) S.A., a risk management consultant firm in Uruguay.
On June 22, 2023, the Company completed the acquisition of % of the share capital of Benefits Corredores de Seguros and Asesorías e Inversiones Benefits, a business that provides health and benefits brokerage and benefit administration in Chile.
Completed Dispositions
The Company completed and dispositions during the three and six months ended June 30, 2024, respectively, and dispositions during the three and six months ended June 30, 2023.
On May 31, 2024, Aon completed the sale of Healthy Paws, its U.S.-based managing general agent specializing in pet insurance, to Chubb Limited.
There were $ million pretax gains recognized related to dispositions for the three and six months ended June 30, 2024. There were pretax gains recognized related to dispositions for the three and six months ended June 30, 2023. Gains recognized as a result of a disposition are included in Other income (expense) in the Condensed Consolidated Statements of Income. There were $ million losses related to dispositions recognized in Accelerating Aon United Program expenses in the Condensed Consolidated Statements of Income for the three and six months ended June 30, 2024. There were losses related to dispositions recognized for the three and six months ended June 30, 2023.
Assets and Liabilities Held for Sale
As of June 30, 2024, Aon classified certain assets and liabilities as held for sale, as the Company has committed to a plan to sell the assets and liabilities within one year. Total assets and liabilities, for disposal groups classified as held for sale within Other current assets and Other current liabilities in the Condensed Consolidated Statements of Financial Position were $ million and $ million, respectively. Of the $ million total assets classified as held for sale, $ million relate to intangible assets.
Other Significant Activity
On May 1, 2017, the Company completed the sale of its benefits administration and business process outsourcing business (the “Divested Business”) to an entity controlled by affiliates of The Blackstone Group L.P. (the “Buyer”) and certain designated purchasers that are direct or indirect subsidiaries of the Buyer. The Buyer purchased all of the outstanding equity interests of the Divested Business, plus certain related assets and liabilities for a purchase price of $ billion in cash paid at closing and deferred consideration of up to $ million. In the first quarter of 2024, the Company earned $ million of deferred consideration from the Buyer and the other designated purchasers. Refer to Note 6 “Other Financial Data” for additional information.
8.
 Goodwill related to current year acquisitions Goodwill related to current year disposals()Foreign currency translation and other()Balance as of June 30, 2024$ 
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 $ $ $ $ $ Tradenames       Technology and other      Total$ $ $ $ $ $  2025 2026 2027 2028 2029 Thereafter Total$ 
9.
 million % Senior Notes matured and were repaid in full.
On April 25, 2024, Aon North America, Inc. drew its $ billion delayed draw term loan and used proceeds, together with the proceeds of the Senior Notes issued on March 1, 2024 described below, to pay a portion of cash consideration in connection with the NFP Transaction, to repay certain debt of NFP, and to pay related fees and expenses. The term loan matures on April 24, 2027 and is prepayable at any time. On May 28, 2024, Aon North America, Inc. repaid $ million of the outstanding balance under the term loan facility.
On April 2, 2024, Aon plc announced that its wholly owned subsidiary, Randolph Acquisition Corp., commenced cash tender offers for any and all of the outstanding % Senior Notes due 2028, % Senior Secured Notes due 2028, % Senior Secured Notes due 2030 and % Senior Secured Notes due 2031, each issued by NFP Corp. (together, the “NFP Notes”), upon the terms and subject to the conditions set forth in the Offer to Purchase and Consent Solicitation Statement, dated as of April 2, 2024. The total amount tendered pursuant to the tender offers was approximately $ billion, excluding premiums. On April 26, 2024, Randolph Acquisition Corp. purchased those NFP Notes that were validly tendered and not validly withdrawn prior to April 15, 2024, effecting the early settlement of the offers (the “Early Settlement”). In addition, on April 16, 2024, NFP Corp. delivered notices of redemption of all NFP Notes not validly tendered pursuant to the offers and purchased at the Early Settlement, at a purchase price equal to the price paid to holders of the NFP Notes in connection with the Early Settlement, with a redemption date of April 26, 2024. As a result of the Early Settlement of the offers and the related redemption which occurred on April 26, 2024, no NFP Notes remain outstanding. Aon plc incurred approximately $ million of debt extinguishment charges in the second quarter of 2024 related to NFP transaction costs.
On March 1, 2024, Aon North America, Inc. issued $ million % Senior Notes due in March 2027, $ billion % Senior Notes due in March 2029, $ million % Senior Notes due in March 2031, $ billion % Senior Notes due in March 2034, and $ billion % Senior Notes due in March 2054, totaling to an aggregate amount of $ billion. The Company intends to use the net proceeds from the offering for general corporate purposes, including a portion of which that was used to pay a portion of the cash consideration in connection with the acquisition of NFP, to repay certain debt of NFP, and to pay related fees and expenses.
In November 2023, Aon Global Limited’s $ million % Senior Notes matured and were repaid in full.
22

 million % Senior Notes due in February 2033. The Company intends to use the net proceeds from the offering for general corporate purposes.
Revolving Credit Facilities
As of June 30, 2024, Aon had primary committed credit facilities outstanding: its $ billion multi-currency U.S. credit facility expiring in September 2027 and its $ billion multi-currency U.S. credit facility expiring in October 2028. In aggregate, these facilities provide $ billion in available credit.
Each of these primary committed credit facilities and the delayed draw term loan includes customary representations, warranties, and covenants, including financial covenants that require Aon to maintain specified ratios of adjusted consolidated EBITDA to consolidated interest expense and consolidated debt to adjusted consolidated EBITDA, in each case, tested quarterly. Aon did t have borrowings under either of these primary committed credit facilities as of June 30, 2024 and December 31, 2023, respectively. Additionally, Aon was in compliance with the financial covenants and all other covenants contained therein during the rolling 12 months ended June 30, 2024.
Commercial Paper
Aon Corporation has established a U.S. commercial paper program (the “U.S. Program”) and Aon Global Holdings plc has established a European multi-currency commercial paper program (the “European Program” and, together with the U.S. Program, the “Commercial Paper Program”). Commercial paper may be issued in aggregate principal amounts of up to approximately $ billion under the U.S. Program and € million ($ million at June 30, 2024 exchange rates) under the European Program, not to exceed the amount of the Company’s committed credit facilities, which was $ billion at June 30, 2024. The aggregate capacity of the Commercial Paper Program remains fully backed by the Company’s committed credit facilities. The U.S. Program was fully and unconditionally guaranteed by Aon plc, Aon Global Limited, Aon North America, Inc., and Aon Global Holdings plc and the European Program was fully and unconditionally guaranteed by Aon plc, Aon Global Limited, Aon North America, Inc., and Aon Corporation.
 $ 
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,
2024202320242023
Weighted average commercial paper outstanding$ $ $ $ 
Weighted average interest rate of commercial paper outstanding % % % %
10.
% and % for the three and six months ended June 30, 2024, respectively. The effective tax rate on Net income was % and % for the three and six months ended June 30, 2023, respectively.
For the three and six months ended June 30, 2024, the tax rate was primarily driven by the geographical distribution of income and certain discrete items, including the favorable impacts of share-based payments offset by the unfavorable impact of discrete items.
For the three and six months ended June 30, 2023, the tax rate was primarily driven by the geographical distribution of income and certain discrete items, including the tax benefit associated with share-based payments and the anticipated sale of certain assets and liabilities classified as held for sale.
Subsequent Events
Ireland, the U.K., and many E.U. member states, among others, have enacted legislation to implement the global minimum tax that are consistent with the OECD’s proposed Pillar Two tax regime. Ireland’s Pillar Two rules changed on July 24, 2024, when
23

11.
billion in authorized repurchases, and was increased by $ billion in authorized repurchases in each of November 2014, June 2017, and November 2020, and by $ billion in February 2022 for a total of $ billion in repurchase authorizations.
Under the Repurchase Program, the Company’s class A ordinary shares may be repurchased through the open market or in privately negotiated transactions, from time to time, based on prevailing market conditions, and will be funded from available capital.
    Average price per share$ $ $ $ 
Repurchase costs recorded to accumulated deficit
$ $ $ $ 
At June 30, 2024, the remaining authorized amount for share repurchases under the Repurchase Program was approximately $ billion. Under the Repurchase Program, the Company has repurchased a total of  million shares for an aggregate cost of approximately $ billion.
Weighted Average Ordinary Shares
    Dilutive effect of potentially issuable shares    Diluted weighted average ordinary shares outstanding    
Potentially issuable shares are not included in the computation of Diluted net income per share attributable to Aon shareholders if their inclusion would be antidilutive. There were  million and  million shares excluded from the calculation for the three and six months ended June 30, 2024, respectively. There were shares excluded from the calculation for the three and six months ended June 30, 2023.
24

 $()$()$()Other comprehensive income (loss) before reclassifications, net ()()()Amounts reclassified from accumulated other comprehensive incomeAmounts reclassified from accumulated other comprehensive income    Tax expense() ()()Amounts reclassified from accumulated other comprehensive income, net    Net current period other comprehensive income (loss) () ()Balance at June 30, 2024$ $()$()$()
 
Change in Fair Value of Financial Instruments (1)
Foreign Currency Translation Adjustments
Postretirement Benefit Obligation (2)
Total
Balance at January 1, 2023$()$()$()$()
Other comprehensive income (loss) before reclassifications, net  () 
Amounts reclassified from accumulated other comprehensive income
Amounts reclassified from accumulated other comprehensive income     
Tax expense() ()()
Amounts reclassified from accumulated other comprehensive income, net    
Net current period other comprehensive income (loss)
    
Balance at June 30, 2023$ $()$()$()
(1)Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Total revenue, Interest expense, and Compensation and benefits in the Condensed Consolidated Statements of Income. Refer to Note 13 “Derivatives and Hedging” for further information regarding the Company’s derivative and hedging activity.
(2)Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Other income (expense) in the Condensed Consolidated Statements of Income.
25

12.
 $ $ $ $ $ Interest cost      Expected return on plan assets, net of administration expenses()()()()()()Amortization of prior-service cost      Amortization of net actuarial loss      Net periodic (benefit) cost  () () Loss on pension settlement      Total net periodic (benefit) cost$ $ $()$ $()$  Six Months Ended June 30, 
U.K.
U.S.
Other 202420232024202320242023Service cost$ $ $ $ $ $ Interest cost      Expected return on plan assets, net of administration expenses()()()()()()Amortization of prior-service cost      Amortization of net actuarial loss      Net periodic (benefit) cost  () () Loss on pension settlement      Total net periodic (benefit) cost$ $ $()$ $() 
In May 2023, to further its pension de-risking strategy, the Company settled certain pension obligations in the Netherlands through the purchase of annuities, where certain pension assets were liquidated to purchase the annuities. A non-cash settlement charge totaling $ million was recognized in the second quarter of 2023.
Contributions
Assuming no additional contributions are agreed to with, or required by, the pension plan trustees, the Company expects to make total cash contributions of approximately $ million, $ million, and $ million (at December 31, 2023 exchange rates) to its significant U.K., U.S., and other major pension plans, respectively, during 2024.
 $ $ $ 
Contributions to U.S. pension plans
    Contributions to other major pension plans    Total contributions$ $ $ $ 
26

13.
. These derivatives are accounted for as hedges, and changes in fair value are recorded each period in Other comprehensive income (loss) in the Condensed Consolidated Statements of Comprehensive Income.
The Company also uses foreign exchange derivatives, typically forward contracts and options, to economically hedge the currency exposure of the Company’s global liquidity profile, including monetary assets or liabilities that are denominated in a non-functional currency of an entity, typically on a rolling -day basis, but may be for up to in the future. These derivatives are not accounted for as hedges, and changes in fair value are recorded each period in Other income (expense) in the Condensed Consolidated Statements of Income.
 $ $ $ $ $ 
Not accounted for as hedges (3)
      Total$ $ $ $ $ $ 
(1)Included within Other current assets ($ million at June 30, 2024 and $ million at December 31, 2023) or Other non-current assets ($ million at June 30, 2024 and $ million at December 31, 2023).
(2)Included within Other current liabilities ($ million at June 30, 2024 and $ million at December 31, 2023).
(3)These contracts typically are for -day durations and executed close to the last day of the most recent reporting month, thereby resulting in nominal fair values at the balance sheet date.

 $ $ $ 
The amounts of derivative gains (losses) reclassified from Accumulated other comprehensive loss to the Condensed Consolidated Statements of Income are as follows (in millions):
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
Gain (loss) recognized in Total revenue$ $()$()$()
The Company estimates that approximately $ million of pretax gains currently included within Accumulated other comprehensive loss will be reclassified into earnings in the next twelve months.
During the three and six months ended June 30, 2024, the Company recorded losses of $ million and $ million, respectively, in Other income (expense) for foreign exchange derivatives not designated or qualifying as hedges. During the three and six months ended June 30, 2023, the Company recorded gains of $ million and $ million, respectively, in Other income (expense) for foreign exchange derivatives not designated or qualifying as hedges.
27

14.
 $ $ $ Other investments    Government bonds$ $ $ $ 
Derivatives (2)
  Gross foreign exchange contracts$ $ $ $ Liabilities   
Derivatives (2)
    Gross foreign exchange contracts$ $ $ $ 
28

 $ $ $ Other investments    Government bonds$ $ $ $ 
Derivatives (2)
    Gross foreign exchange contracts$ $ $ $ Liabilities  0 
Derivatives (2)
    Gross foreign exchange contracts$ $ $ $ 
(1)Included within Fiduciary assets or Short-term investments in the Condensed Consolidated Statements of Financial Position, depending on their nature and initial maturity.
 
There were no transfers of assets or liabilities between fair value hierarchy levels in the three and six months ended June 30, 2024 or 2023. The Company recognized no realized or unrealized gains or losses in the Condensed Consolidated Statements of Income during the three and six months ended June 30, 2024 or 2023 related to assets and liabilities measured at fair value using unobservable inputs.
 $ $ $ Long-term debt$ $ $ $ 
15.
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 million plus any liability the owner has to third parties. In November 2019, a federal prosecutor in Brazil filed a public civil action naming Aon entities as defendants, along with the airline, the insurer and the lead reinsurer. That claim seeks pecuniary damages for families affected by the crash in the sum of $ million; or, in the alternative, $ million; or, in the alternative, $ million; plus “moral damages” of an equivalent sum. Separately, in March 2020, the Brazilian Federal Senate invited Aon to give evidence to a Parliamentary Commission of Inquiry in an investigation into the accident. Aon cooperated with that inquiry. In August 2020, individuals (surviving passengers and estates of the deceased) filed a motion in the Circuit Court of the 11th Judicial Circuit in and for Miami-Dade County, Florida, seeking permission to commence proceedings against Aon (and the insurer and reinsurers) for claims totaling $ million. Finally, in April 2021, representatives of passengers issued a claim against Aon in the High Court in England seeking damages under the Fatal Accidents Act 1976 in the sum of £ million ($ million at June 30, 2024 exchange rates). In February 2024, the claim brought by representatives of passengers in the High Court in England was dismissed pursuant to an agreement among the parties. In December 2022, the High Court in England granted an anti-suit injunction, restricting the individuals who previously filed a motion in the Circuit Court of the 11th Judicial Circuit in and for Miami Dade County, Florida, from continuing litigation in the Circuit Court of the 11th Judicial Circuit against Aon. Aon believes that it has meritorious defenses and intends to vigorously defend itself against the remaining claims.
Certain of the Company’s clients and counterparties have initiated or indicated that they may initiate legal proceedings against the Company following allegations in July 2023 that fraudulent letters of credit were issued in the name of third-party banks in connection with transactions for which capital was arranged by Vesttoo Ltd. (“Vesttoo”). Vesttoo is one of the third parties that identifies capital providers to collateralize insurance and reinsurance obligations of the Company’s clients and counterparties. In certain transactions in which Vesttoo identified third party capital providers to collateralize reinsurance obligations, including transactions in which the Company or its affiliates provided brokerage or other services, some letters of credit from third party banks are alleged to have been fraudulent. The pending or threatened legal proceedings against the Company allege, among other theories of liability, that in certain circumstances the Company failed to comply with its alleged duty to procure appropriate letters of credit. In particular, on November 30, 2023, Clear Blue Insurance Company and certain of its affiliates filed a lawsuit in New York State Supreme Court against Aon plc and Aon Insurance Managers (Bermuda) Ltd. alleging such claims. While Aon has settled and/or is in discussions to settle certain claims, Aon believes that it has meritorious defenses and intends to vigorously defend itself against those claims that are not settled. In the fourth quarter of 2023, the Company recognized actual or anticipated legal settlement expenses in connection with these matters of $ million, of which a potentially significant amount may be recoverable in future periods. Aon may also seek recourse against third parties where appropriate, including in connection with bankruptcy proceedings filed by Vesttoo in the Bankruptcy Court for the U.S. District of Delaware. In addition, in August 2023, joint provisional liquidators were appointed over one of the Company’s subsidiaries in Bermuda with respect to segregated accounts that were impacted by the allegedly fraudulent letters of credit. The joint provisional liquidators were released from their appointment on July 3, 2024. Aon continues to cooperate with regulators in Bermuda, and other regulatory authorities could initiate investigations or proceedings against the Company or third parties.
Guarantees and Indemnifications
The Company provides a variety of guarantees and indemnifications to its customers and others. The maximum potential amount of future payments represents the notional amounts that could become payable under the guarantees and indemnifications if there were a total default by the guaranteed parties, without consideration of possible recoveries under recourse provisions or other methods. These amounts may bear no relationship to the expected future payments, if any, for these guarantees and indemnifications. Any anticipated amounts payable are included in the Condensed Consolidated Financial Statements, and are recorded at fair value.
The Company expects that, as prudent business interests dictate, additional guarantees and indemnifications may be issued from time to time.
Guarantee of Registered Securities
On June 22, 2023, Aon plc, Aon Global Limited, Aon Global Holdings plc, Aon Corporation, and Aon North America, Inc., and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”), as applicable, entered into supplemental indentures, each dated June 22, 2023, amending each of the following indentures (as amended, supplemented or modified from time to time) to add for the benefit of the holders of the instruments issued thereunder a full and unconditional guarantee of Aon North America, Inc. thereunder: (i) Second Amended and Restated Indenture, dated April 1, 2020, among Aon Corporation, Aon plc, Aon Global Limited, Aon Global Holdings plc and the Trustee (amending and restating the Amended and Restated Indenture, dated April 2, 2012, amending and restating the Indenture, dated January 13, 1997); (ii) Second Amended and Restated Indenture, dated April 1, 2020, among Aon Corporation, Aon plc, Aon Global Limited, Aon Global Holdings plc and the Trustee (amending and restating the Amended and Restated Indenture, dated April 2, 2012, amending and restating the
30

million at June 30, 2024, and $ million at December 31, 2023. These LOCs cover the beneficiaries related to certain of Aon’s U.S. and Canadian secure non-qualified pension plan schemes, reinsurance obligations related to Aon’s own E&O liability insurance program, and secure deductible retentions for Aon’s own workers compensation program. The Company has also obtained LOCs to cover contingent payments for taxes and other business obligations to third parties, and other guarantees for miscellaneous purposes at its international subsidiaries.
Premium Payments
The Company has certain contractual contingent guarantees for premium payments owed by clients to certain insurance companies. The maximum exposure with respect to such contractual contingent guarantees was approximately $ million at June 30, 2024 compared to $ million at December 31, 2023.
16.
segment that includes all of Aon’s operations, which as a global professional services firm provides a broad range of Risk and Human Capital Solutions through solution lines — Commercial risk, Reinsurance, Health, and Wealth, which make up its principal products and services. The CODM assesses the performance of the Company and allocates resources based on segment: Aon United.
The Company’s reportable operating segment has been determined using a management approach, which is consistent with the basis and manner in which the CODM uses financial information for the purposes of allocating resources and evaluating performance. The CODM assesses performance and allocates resources based on total Aon results against its key metrics, expense discipline, and collaborative behaviors that maximize value for Aon and its shareholders, regardless of which solution line it benefits.
As Aon operates as segment, segment profit or loss is consistent with consolidated reporting as disclosed in the Condensed Consolidated Statements of Income. Refer to Note 3 “Revenue from Contracts with Customers” for further information on revenue by principal service line.
31

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations
EXECUTIVE SUMMARY OF SECOND QUARTER 2024 FINANCIAL RESULTS
Aon plc is a leading global professional services firm providing a broad range of Risk and Human Capital Solutions. Through our experience, global reach, and comprehensive analytics, we help clients meet rapidly changing, increasingly complex, and interconnected challenges related to risk and people. We are committed to accelerating innovation to address unmet and evolving client needs so that our clients are better informed, better advised, and able to make better decisions to protect and grow their business. Management remains focused on strengthening Aon and uniting the firm with one portfolio of capability enabled by data and analytics and one operating model to deliver additional insight, connectivity, and efficiency.
Financial Results
The following is a summary of our second quarter of 2024 financial results.
•Revenue increased $583 million, or 18%, to $3.8 billion compared to the prior year period, reflecting acquired revenues from NFP and 6% organic revenue growth, partially offset by a 1% unfavorable impact from foreign currency translation. For the first six months of 2024, revenue increased $782 million, or 11%, to $7.8 billion compared to the prior year period due primarily to acquired revenues from the acquisition of NFP, organic revenue growth of 5%, and a 1% favorable impact from fiduciary investment income.
•Total operating expenses in the second quarter increased $769 million, or 33%, to $3.1 billion compared to the prior year period, due primarily to the inclusion of NFP’s ongoing operating expenses, Accelerating Aon United restructuring program charges, an increase in expense associated with 6% organic revenue growth, and investments in long-term growth, partially offset by $25 million of restructuring savings realized in the quarter and a $9 million favorable impact from foreign currency translation. Operating expenses for the first six months of 2024 were $5.7 billion, an increase of $976 million, or 21%, compared to the prior year period due primarily to the inclusion of NFP’s ongoing operating expenses, an increase in expense associated with 5% organic growth and Accelerating Aon United restructuring charges, partially offset by $45 million of restructuring savings.
•Operating margin decreased to 17.4% from 26.5% in the prior year period. The decrease was driven by an increase in operating expenses as listed above, partially offset by total revenue growth of 18%. Operating margin for the first six months of 2024 decreased to 27.1% from 32.8% in the prior period. The decrease was primarily driven by an increase in operating expenses as listed above and partially offset by total revenue growth of 11%.
•Due to the factors set forth above, net income decreased $37 million, or 6%, to $538 million compared to the prior year period. For the first six months of 2024, Net income decreased $23 million, or 1%, to $1.6 billion compared to the first six months of 2023.
•Diluted earnings per share was $2.46 compared to $2.71 per share for the prior year period. During the first six months of 2024, diluted earnings per share was $7.72 compared to $7.79 per share for the prior period.
•Cash flows provided by operating activities was $822 million for the first six months of 2024, a decrease of $309 million from the prior year period, primarily due to higher receivables, including from NFP, payments related to transaction and integration costs, legal settlement expenses, restructuring, and higher cash taxes, partially offset by strong adjusted operating income growth.
We focus on four key metrics not presented in accordance with U.S. GAAP that we communicate to shareholders: organic revenue growth, adjusted operating margin, adjusted diluted earnings per share, and free cash flow. These non-GAAP metrics should be viewed in addition to, not instead of, our Condensed Consolidated Financial Statements. The following is our measure of performance against these four metrics for the second quarter of 2024:
•Organic revenue growth is a non-GAAP measure defined under the caption “Review of Consolidated Results — Organic Revenue Growth.” Organic revenue growth was 6% for the second quarter of 2024, driven by net new business generation and ongoing strong retention, Organic revenue growth was 5% for the first six months of 2024, driven by net new business generation and ongoing strong retention.
•Adjusted operating margin, a non-GAAP measure defined under the caption “Review of Consolidated Results — Adjusted Operating Margin,” was 27.4% for the second quarter of 2024 compared to 27.3% in the prior year period. The increase in adjusted operating income reflects the impact from NFP, organic revenue growth, net restructuring savings and increased fiduciary investment income, partially offset by increased expenses and investments in long-term growth. For the first six months of 2024, adjusted operating margin was 33.8% compared to 33.6% for the prior year period. The increase primarily reflects the impact of NFP, organic revenue growth, restructuring savings and increased fiduciary investment income, partially offset by increased expenses and investments in long-term growth.
32

•Adjusted diluted earnings per share, a non-GAAP measure defined under the caption “Review of Consolidated Results — Adjusted Diluted Earnings per Share,” was $2.93 per share for the second quarter of 2024 and $8.50 per share for the first six months of 2024, compared to $2.76 and $7.93 per share for the respective prior year periods.
•Free cash flow, a non-GAAP measure defined under the caption “Review of Consolidated Results — Free Cash Flow,” decreased in the first six months of 2024 by $265 million from the prior year period, to $721 million, reflecting a decrease in cash flows from operations, partially offset by a $44 million decrease in capital expenditures.
ENVIRONMENTAL, SOCIAL, AND GOVERNANCE
For many companies, the management of ESG risks and opportunities has become increasingly important, and ESG-related challenges, such as extreme weather events, supply chain disruptions, cyber events, regulatory changes, ongoing public health impacts, and the increased focus on workforce resilience in various work environments, continue to create volatility and uncertainty for our clients. At Aon, helping clients manage risk - including ESG risk - is at the core of what we do. We offer a wide range of risk assessment, consulting, and advisory solutions, many of which are significant parts of our core business offerings, designed to address and manage ESG issues for clients, and to enable our clients to create more sustainable value. We see significant opportunity in enhancing our impact and delivering innovative client solutions on ESG matters.
ACQUISITION OF NFP
On April 25, 2024, the Company completed its acquisition of NFP, a leading middle-market provider of property and casualty brokerage, benefits consulting, wealth management, and retirement plan consulting, with more than 7,700 colleagues. The Company acquired NFP Intermediate Holdings A Corp. in a cash-and-stock merger for an aggregate preliminary purchase price totaling $9.1 billion, including approximately $3.2 billion to settle NFP indebtedness and cash consideration to the selling shareholders, and approximately 19 million class A ordinary shares with a fair value of approximately $5.9 billion, based on the Company’s closing stock price on April 25, 2024.
33

REVIEW OF CONSOLIDATED RESULTS 
Summary of Results
Our consolidated results (unaudited) are as follows (in millions):
 Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
Revenue  
Total revenue$3,760 $3,177 $7,830 $7,048 
Expenses  
Compensation and benefits2,130 1,754 4,013 3,546 
Information technology132 129 256 268 
Premises82 68 153 143 
Depreciation of fixed assets45 39 89 77 
Amortization and impairment of intangible assets128 25 144 50 
Other general expense455 320 803 649 
Accelerating Aon United Program expenses132 — 251 — 
Total operating expenses3,104 2,335 5,709 4,733 
Operating income656 842 2,121 2,315 
Interest income31 5 59 10 
Interest expense(225)(130)(369)(241)
Other income (expense)236 (59)311 (84)
Income before income taxes698 658 2,122 2,000 
Income tax expense160 83 491 346 
Net income538 575 1,631 1,654 
Less: Net income attributable to redeemable and non-redeemable noncontrolling interests14 15 36 44 
Net income attributable to Aon shareholders$524 $560 $1,595 $1,610 
Diluted net income per share attributable to Aon shareholders$2.46 $2.71 $7.72 $7.79 
Weighted average ordinary shares outstanding - diluted213.3 206.3 206.7 206.7 
Revenue
Total revenue increased $583 million, or 18%, to $3.8 billion, compared to the prior year period, due to acquired revenues from the acquisition of NFP, and organic revenue growth of 6%, driven by net new business generation and ongoing strong retention, partially offset by a 1% unfavorable impact from foreign currency translation. For the first six months of 2024, revenue increased $782 million, or 11%, to $7.8 billion compared to the prior year period. This increase reflects the acquired revenues from the acquisition of NFP, organic revenue growth of 5%, and a 1% favorable impact from fiduciary investment income.
Commercial Risk Solutions revenue increased $241 million, or 14%, to $2.0 billion in the second quarter of 2024, primarily related to acquired revenues from the acquisition of NFP, compared to $1.8 billion in the second quarter of 2023. Organic revenue growth was 6% in the second quarter of 2024, reflecting growth across all major geographies driven by net new business generation and ongoing strong retention. Growth in retail brokerage was highlighted by double-digit growth in EMEA and Latin America, and strong growth in North America, which includes the majority of NFP Commercial Risk, and Asia and the Pacific, driven by continued strength in core P&C. Results also reflect a positive impact from growth in Affinity. On average globally, exposures were positive and aggregate pricing was flat, resulting in modestly positive market impact. For the first six months of 2024, revenue increased $271 million, or 8% to $3.8 billion, compared to $3.6 billion in the first six months of 2023. Organic revenue growth was 4% in the first six months of 2024, reflecting growth across all major geographies, driven by net new business generation and strong retention.
Reinsurance Solutions revenue increased $28 million, or 5%, to $635 million in the second quarter of 2024, compared to $607 million in the second quarter of 2023. Organic revenue growth was 7% in the second quarter of 2024, reflecting strong growth in treaty, driven by net new business generation and ongoing strong retention, as well as strong growth in facultative
34

placements. Market impact was modestly positive on results in the quarter. For the first six months of 2024, revenue increased $118 million, or 7%, to $1.8 billion, compared to $1.7 billion in the first six months of 2023. Organic revenue growth was 7% in the first six months of 2024, driven by net new business generation and strong retention. The majority of revenue in our treaty portfolio is recurring in nature and is recorded in connection with the major renewal periods that take place throughout the first half of the year.
Health Solutions revenue increased $215 million, or 48%, to $662 million in the second quarter of 2024, primarily related to acquired revenues from the acquisition of NFP and 6% organic revenue growth, compared to $447 million in the second quarter of 2023. Organic revenue growth was 6% in the second quarter of 2024, reflecting high single-digit growth globally in core health and benefits brokerage, including in NFP, driven by net new business generation and ongoing strong retention. Strength in the core was highlighted by strong growth in all major geographies. Results also reflect strong growth in Consumer Facing Solutions, and executive benefits in NFP, partially offset by a decline in Talent driven by lower demand in more discretionary project-related work. For the first six months of 2024, revenue increased $277 million, or 25%, to $1.4 billion, compared to the first six months of 2023. Organic revenue growth was 6% in the first six months of 2024, reflecting strong growth globally in core health and benefits brokerage.
Wealth Solutions revenue increased $111 million, or 32%, to $463 million in the second quarter of 2024, primarily related to acquired revenues from the acquisition of NFP and 9% organic revenue growth, compared to $352 million in the second quarter of 2023. Organic revenue growth was 9% in the second quarter of 2024, reflecting strong growth in Retirement, driven by advisory demand and project-related work related to pension de-risking and ongoing impact of regulatory changes. Strong growth in Investments was highlighted by strong revenue growth within NFP, driven by asset inflows and market performance. For the first six months of 2024, revenue increased $131 million, or 19%, to $833 million, compared to $702 million in the first six months of 2023. Organic revenue growth was 6% in the first six months of 2024, reflecting growth in Retirement, driven by advisory demand and project-related work related to pension de-risking and ongoing impact of regulatory changes.
Compensation and Benefits
Compensation and benefits expense increased $376 million, or 21%, and compared to the prior year period due primarily to the inclusion of ongoing operating expenses from NFP and expense associated with 6% organic revenue growth, partially offset by a $6 million favorable impact from foreign currency translation and savings from Accelerating Aon United restructuring actions. For the first six months of 2024, compensation and benefits increased $467 million, or 13%, compared to the first six months of 2023. The increase was primarily driven by the inclusion of ongoing operating expenses from NFP and an increase in expense associated with 5% organic revenue growth, partially offset by savings from Accelerating Aon United restructuring actions.
Information Technology
Information technology expenses, which represent costs associated with supporting and maintaining our infrastructure, increased $3 million, or 2%, compared to the prior year period due primarily to the inclusion of ongoing operating expenses from NFP, partially offset by savings from Accelerating Aon United restructuring actions and efficiencies from our Aon Business Services operating platform. For the first six months of 2024, information technology expenses decreased $12 million, or 4%, compared to the first six months of 2023. The decrease was due primarily to elevated technology costs and investments in the prior year period, noting that spend may vary between quarters given timing of projects and investments within the year, partially offset by the inclusion of ongoing operating expenses from NFP.
Premises
Premises expenses, which represent the cost of occupying offices in various locations throughout the world, increased $14 million, or 21%, in the second quarter of 2024 and increased $10 million, or 7% for the first six months of 2024, each compared to the prior year period, due primarily to the inclusion of ongoing operating expenses from NFP.
Depreciation of Fixed Assets
Depreciation of fixed assets primarily relates to software, leasehold improvements, furniture, fixtures, and equipment, computer equipment, buildings, and automobiles. Depreciation of fixed assets increased $6 million, or 15%, in the second quarter of 2024 and increased $12 million, or 16% for the first six months of 2024, each compared to the prior year period due primarily to the inclusion of ongoing operating expenses from NFP, and ongoing investments in Aon Business Services-enabled technology platforms to drive long-term growth.
Amortization and Impairment of Intangible Assets
Amortization and impairment of intangible assets primarily relates to finite-lived customer-related and contract-based assets as well as technology and other assets. Amortization and impairment of intangible assets increased $103 million, or
35

412% in the second quarter of 2024 and increased $94 million, or 188% for the first six months of 2024, each compared to the prior year period due primarily to an increase in intangible assets related to the NFP acquisition.
Other General Expense
Other general expenses increased $135 million, or 42%, in the second quarter of 2024 and increased $154 million, or 24% for the first six months of 2024, each compared to the prior year period due primarily to transaction and integration costs, and the inclusion of ongoing operating expenses from NFP.
Accelerating Aon United Program Expenses
Accelerating Aon United Program expenses were $132 million and $251 million for the three and six months ended June 30, 2024, respectively, relating to workforce optimization, asset impairments, and technology and other costs.
Interest Income
Interest income represents income, net of expense, earned on operating cash balances and other income-producing investments. It does not include interest earned on funds held on behalf of clients. During the second quarter of 2024, interest income increased $26 million to $31 million and for the first six months of 2024, interest income increased $49 million to $59 million compared to the prior year period primarily reflecting interest earned on the investment of $5 billion of term debt proceeds, which were ultimately used to fund the purchase of NFP.
Interest Expense
Interest expense, which represents the cost of our debt obligations, increased $95 million to $225 million during the second quarter of 2024 compared to the prior year period, reflecting an increase in total debt outstanding and interest expense related to one-time discrete items. For the first six months of 2024, interest expense increased $128 million to $369 million compared to the prior year period. The increase was driven primarily by higher interest rates and an increase in total debt outstanding.
Other Income (Expense)
Other income (expense) for the second quarter of 2024 increased $295 million compared to the prior year period, where Other income was $236 million for the second quarter of 2024 and Other expense was $59 million for the second quarter of 2023. The increase was primarily driven by gains related to the sale of a business. Other income (expense) for first six months of 2024 increased $395 million compared to the prior year period. Other income was $311 million for the first six months of 2024, due primarily to gains related to the sale of a business. Other expense was $84 million for the first six months of 2023 due primarily to non-cash periodic pension cost and expense from the unfavorable impact of exchange rates on the remeasurement of assets and liabilities in non-functional currencies.
Income before Income Taxes
Due to the factors discussed above, Income before income taxes for the second quarter of 2024 was $698 million, a 6% increase from $658 million in the second quarter of 2023. For the first six months of 2024, Income before income taxes was $2.1 billion, a 6% increase from $2.0 billion for the first six months of 2023.
Income Taxes
The effective tax rate on Net income was 22.9% and 23.1% for the three and six months ended June 30, 2024, respectively. The effective tax rate on Net income was 12.6% and 17.3% for the three and six months ended June 30, 2023, respectively.
For the three and six months ended June 30, 2024, the tax rate was primarily driven by the geographical distribution of income and certain discrete items, including the favorable impact of share-based payments offset by the unfavorable impact of discrete items.
For the three and six months ended June 30, 2023, the tax rate was primarily driven by the geographical distribution of income and certain discrete items, including the tax benefits associated with share-based payments and the anticipated sale of certain assets and liabilities classified as held for sale.
Subsequent Events
Ireland, the U.K., and many E.U. member states, among others, have enacted legislation to implement the global minimum tax that are consistent with the OECD’s proposed Pillar Two tax regime. Ireland’s Pillar Two rules changed on July 24, 2024, when the last E.U. member state consented to the OECD’s administrative guidance, but there remains significant uncertainty as to how Ireland’s Pillar Two tax regime and the OECD’s past and potentially future Pillar Two guidance will ultimately apply to the Company. The Company is actively monitoring developments in this area and continues to evaluate the guidance and the
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potential estimated impacts this may have on its global effective tax rate, results of operations, cash flows, and financial condition in 2024.
Net Income Attributable to Aon Shareholders
Net income attributable to Aon shareholders for the second quarter of 2024 decreased to $524 million, or $2.46 per diluted share, from $560 million, or $2.71 per diluted share, in the prior year period. Net income attributable to Aon shareholders for the first six months of 2024 decreased $15 million to $1,595 million, or $7.72 per diluted share, from $7.79 per diluted share, in the prior year period.
Non-GAAP Metrics
In our discussion of consolidated results, we sometimes refer to certain non-GAAP supplemental information derived from consolidated financial information specifically related to organic revenue growth, adjusted operating margin, adjusted diluted earnings per share, adjusted net income attributable to Aon shareholders, adjusted net income per share, adjusted other income (expense), adjusted effective tax rate, free cash flow, and the impact of foreign exchange rate fluctuations on operating results. Management believes that these measures are important to make meaningful period-to-period comparisons and that this supplemental information is helpful to investors. Management also uses these measures to assess operating performance and performance for compensation. This non-GAAP supplemental information should be viewed in addition to, not instead of, our Condensed Consolidated Financial Statements.
Organic Revenue Growth
We use supplemental information related to organic revenue growth to help us and our investors evaluate business growth from ongoing operations. Organic revenue growth is a non-GAAP measure that includes the impact of certain intercompany activity and excludes the impact of changes in foreign exchange rates, fiduciary investment income, acquisitions (provided that organic revenue growth includes organic growth of an acquired business as calculated assuming that the acquired business was part of the combined company for the same proportion of the relevant prior year period), divestitures (including held for sale disposal groups), divestitures (including held for sale disposal groups), transfers between revenue lines, and gains or losses on derivatives accounted for as hedges. This supplemental information related to organic revenue growth represents a measure not in accordance with U.S. GAAP and should be viewed in addition to, not instead of, our Condensed Consolidated Financial Statements. Industry peers provide similar supplemental information about their revenue performance, although they may not make identical adjustments. A reconciliation of this non-GAAP measure to the reported Total revenue is as follows (in millions, except percentages):
 Three Months Ended June 30,
20242023% Change
Less: Currency Impact (1)
Less: Fiduciary Investment Income (2)
Less: Acquisitions, Divestitures & Other
Organic Revenue Growth (3)
Revenue
Commercial Risk Solutions$2,015 $1,774 14 %(1)%— %9 %6 %
Reinsurance Solutions635 607 5 (2)— — 7 
Health Solutions662 447 48 — — 42 6 
Wealth Solutions463 352 32 — — 23 9 
Eliminations(15)(3)N/AN/AN/AN/AN/A
Total revenue$3,760 $3,177 18 %(1)%— %13 %6 %
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 Six Months Ended June 30,
20242023% Change
Less: Currency Impact (1)
Less: Fiduciary Investment Income (2)
Less: Acquisitions, Divestitures & Other
Organic Revenue Growth (3)
Revenue
Commercial Risk Solutions$3,823 $3,552 8 %— %1 %3 %4 %
Reinsurance Solutions1,802 1,684 7 — 1 (1)7 
Health Solutions1,395 1,118 25 — — 19 6 
Wealth Solutions833 702 19 1 — 12 6 
Eliminations(23)(8)N/AN/AN/AN/AN/A
Total revenue$7,830 $7,048 11 %— %1 %5 %5 %
(1)Currency impact represents the effect on prior year period results if they were translated at current period foreign exchange rates.
(2)Fiduciary investment income for the three months ended June 30, 2024 and 2023, was $75 million and $64 million, respectively. Fiduciary investment income for the six months ended June 30, 2024 and 2023 was $154 million and $116 million, respectively.
(3)Organic revenue growth includes the impact of certain intercompany activity and excludes the impact of changes in foreign exchange rates, fiduciary investment income, acquisitions (provided that organic revenue growth includes organic growth of an acquired business as calculated assuming that the acquired business was part of the combined company for the same proportion of the relevant prior year period), divestitures (including held for sale disposal groups), transfers between revenue lines, and gains or losses on derivatives accounted for as hedges.
Adjusted Operating Margin
We use adjusted operating margin as a non-GAAP measure of our core operating performance. Adjusted operating margin excludes the impact of certain items, as listed below, because management does not believe these expenses are the best indicators of our core operating performance. This supplemental information related to adjusted operating margin represents a measure not in accordance with U.S. GAAP and should be viewed in addition to, not instead of, our Condensed Consolidated Financial Statements.
A reconciliation of this non-GAAP measure to the reported operating margin is as follows (in millions, except percentages):
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
Revenue$3,760 $3,177 $7,830 $7,048 
Operating income$656 $842 $2,121 $2,315 
Amortization and impairment of intangible assets128 25 144 50 
Changes in the fair value of contingent consideration 18 — 18 — 
Accelerating Aon United Program expenses (1)
132 — 251 — 
Transaction and integration costs (2)
95 — 110 — 
Adjusted operating income$1,029 $867 $2,644 $2,365 
Operating margin17.4 %26.5 %27.1 %32.8 %
Adjusted operating margin27.4 %27.3 %33.8 %33.6 %
(1)Total charges are expected to include technology-related costs to facilitate streamlining and simplifying operations, headcount reduction costs, and costs associated with asset impairments, including real estate consolidation and technology costs.
(2)On April 25, 2024, the Company completed the acquisition of NFP. As part of the acquisition, Aon incurred $101 million and $116 million of transaction and integration costs during the three and six months ended June 30, 2024, respectively. Transaction costs include advisory, legal, accounting, regulatory, and other professional or consulting fees required to complete the acquisition. For the three months ended June 30, 2024, $79 million of transaction costs were recognized in Total operating expenses and $6 million were recognized within Other income (expense) related to the extinguishment of acquired NFP debt. For the six months ended June 30, 2024, $90 million of transaction costs were recognized in Total operating expenses and $6 million were recognized in Other income (expense). In connection with the NFP acquisition, Aon incurred certain non-recurring integration costs associated with colleague severance, retention bonus awards, termination of redundant third-party agreements, costs associated with legal entity rationalization, and professional or consulting fees related to alignment of management processes and controls, as well as costs associated with the assessment of NFP information technology environment and security protocols. Aon incurred $16 million and $20 million of integration costs in the three and six months ended June 30, 2024, respectively.

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Adjusted Diluted Earnings per Share
We use adjusted diluted earnings per share as a non-GAAP measure of our core operating performance. Adjusted diluted earnings per share excludes the impact of certain items, as listed below, because management does not believe these expenses are the best indicators of our core operating performance. This supplemental information related to adjusted diluted earnings per share represents a measure not in accordance with U.S. GAAP and should be viewed in addition to, not instead of, our Condensed Consolidated Financial Statements.
A reconciliation of this non-GAAP measure to reported diluted earnings per share is as follows (in millions, except per share data and percentages):
 Three Months Ended June 30, 2024
U.S. GAAP
Adjustments
Non-GAAP Adjusted
Operating income $656 $373 $1,029 
Interest income31 — 31 
Interest expense(225)— (225)
Other income (expense) (1)(2)
236 (251)(15)
Income before income taxes698 122 820 
Income tax expense (3)
160 22 182 
Net income538 100 638 
Less: Net income attributable to noncontrolling interests14 — 14 
Net income attributable to Aon shareholders$524 $100 $624 
Diluted net income per share attributable to Aon shareholders$2.46 $0.47 $2.93 
Weighted average ordinary shares outstanding - diluted 213.3 — 213.3 
Effective tax rates (3)
22.9 %22.2 %
 Three Months Ended June 30, 2023
U.S. GAAP
Adjustments
Non-GAAP Adjusted
Operating income$842 $25 $867 
Interest income5 — 5 
Interest expense(130)— (130)
Other income (expense) (4)
(59)27 (32)
Income before income taxes658 52 710 
Income tax expense (3)
83 42 125 
Net income575 10 585 
Less: Net income attributable to noncontrolling interests15 — 15 
Net income attributable to Aon shareholders$560 $10 $570 
Diluted net income per share attributable to Aon shareholders$2.71 $0.05 $2.76 
Weighted average ordinary shares outstanding - diluted 206.3 — 206.3 
Effective tax rates (3)
12.6 %17.6 %

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 Six Months Ended June 30, 2024
U.S. GAAP
Adjustments
Non-GAAP Adjusted
Operating income $2,121 $523 $2,644 
Interest income59 — 59 
Interest expense(369)— (369)
Other income (expense) (1)(2)(5)
311 (333)(22)
Income before income taxes2,122 190 2,312 
Income tax expense (3)
491 28 519 
Net income1,631 162 1,793 
Less: Net income attributable to noncontrolling interests36 — 36 
Net income attributable to Aon shareholders$1,595 $162 $1,757 
Diluted net income per share attributable to Aon shareholders$7.72 $0.78 $8.50 
Weighted average ordinary shares outstanding - diluted 206.7 — 206.7 
Effective tax rates (3)
23.1 %22.4 %

 Six Months Ended June 30, 2023
U.S. GAAP
Adjustments
Non-GAAP Adjusted
Operating income$2,315 $50 $2,365 
Interest income10 — 10 
Interest expense(241)— (241)
Other income (expense) (4)
(84)27 (57)
Income before income taxes2,000 77 2,077 
Income tax expense (3)
346 47 393 
Net income1,654 30 1,684 
Less: Net income attributable to noncontrolling interests44 — 44 
Net income attributable to Aon shareholders$1,610 $30 $1,640 
Diluted net income per share attributable to Aon shareholders$7.79 $0.14 $7.93 
Weighted average ordinary shares outstanding - diluted 206.7 — 206.7 
Effective tax rates (3)
17.3 %18.9 %
(1)Adjusted Other income (expense) excluded gains from dispositions of $257 million related to the sale of a business for the three and six months ended June 30, 2024.
(2)Adjusted Other income (expense) excluded approximately $6 million of debt extinguishment charges related to the repayment of NFP debt, which is considered a transaction related cost incurred in the second quarter of 2024.
(3)Adjusted items are generally taxed at the estimated annual effective tax rate, except for the applicable tax impact associated with the anticipated sale of certain assets and liabilities classified as held for sale, certain pension settlements, Accelerating Aon United Program expenses, deferred consideration from a prior year sale of business, certain gains from dispositions, certain transaction and integration costs related to the acquisition of NFP, and changes in the fair value of contingent consideration, which are adjusted at the related jurisdictional rate.
(4)To further its pension de-risking strategy, the Company settled certain pension obligations in the Netherlands through the purchase of annuities, where certain pension assets were liquidated to purchase the annuities. A non-cash settlement charge totaling $27 million was recognized in the second quarter of 2023 which is excluded from adjusted other income (expense).
(5)In the first quarter of 2024, the Company earned $82 million of deferred consideration from the affiliates of The Blackstone Group L.P. and the other designated purchasers related to the 2017 sale of the benefits administration and business process outsourcing business.
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Free Cash Flow
We use free cash flow, defined as cash flows provided by operations less capital expenditures, as a non-GAAP measure of our core operating performance and cash-generating capabilities of our business operations. This supplemental information related to free cash flow represents a measure not in accordance with U.S. GAAP and should be viewed in addition to, not instead of, our Condensed Consolidated Financial Statements. Management believes the supplemental information related to free cash flow is helpful to investors when evaluating our operating performance and liquidity results. The use of this non-GAAP measure does not imply or represent the residual cash flow for discretionary expenditures. A reconciliation of this non-GAAP measure to the reported Cash provided by operating activities is as follows (in millions):
 Six Months Ended June 30,
20242023
Cash provided by operating activities$822 $1,131 
Capital expenditures(101)(145)
Free cash flow$721 $986 
Impact of Foreign Exchange Rate Fluctuations
Because we conduct business in over 120 countries, foreign exchange rate fluctuations may have a significant impact on our business. Foreign exchange rate movements may be significant and may distort true period-to-period comparisons of changes in revenue or pretax income. Therefore, to give financial statement users meaningful information about our operations, we have provided an illustration of the comparable impact of foreign currency exchange rates on our financial results. The methodology used to calculate this comparable impact isolates the impact of the change in currencies between periods by hypothetically translating the prior year quarter’s revenue, expenses, and net income using the current quarter’s foreign exchange rates.
Currency fluctuations had an unfavorable impact of $0.05 and an unfavorable impact of $0.04 on net income per diluted share during the three and six months ended June 30, 2024, respectively, if prior year period results were translated at current period foreign exchange rates. Currency fluctuations had an unfavorable impact of $0.05 and an unfavorable impact of $0.19 on net income per diluted share during the three and six months ended June 30, 2023, respectively, if 2022 results were translated at 2023 rates.
Currency fluctuations had an unfavorable impact of $0.06 and an unfavorable impact of $0.04 on adjusted diluted earnings per share during the three and six months ended June 30, 2024, respectively, if prior year period results were translated at current period foreign exchange rates. Currency fluctuations had an unfavorable impact of $0.05 and an unfavorable impact of $0.19 on adjusted diluted earnings per share during the three and six months ended June 30, 2023, respectively, if 2022 results were translated at 2023 rates. These translations are performed for comparative and illustrative purposes only and do not impact the accounting policies or practices for amounts included in our Condensed Consolidated Financial Statements.
LIQUIDITY AND FINANCIAL CONDITION
Liquidity
Executive Summary
We believe that our balance sheet and strong cash flow provide us with adequate liquidity. Our primary sources of liquidity in the near-term include cash flows provided by operations and available cash reserves; primary sources of liquidity in the long-term include cash flows provided by operations, debt capacity available under our credit facilities, and capital markets. Our primary uses of liquidity are operating expenses and investments, capital expenditures, acquisitions, share repurchases, pension obligations, shareholder dividends, and Accelerating Aon United Program cash charges. We believe that cash flows from operations, available credit facilities, available cash reserves, and the capital markets will be sufficient to meet our liquidity needs, including principal and interest payments on debt obligations, capital expenditures, pension contributions, and anticipated working capital requirements in the next twelve months and over the long-term.
Cash on our balance sheet includes funds available for general corporate purposes, as well as amounts restricted as to their use. Funds held on behalf of clients in a fiduciary capacity are segregated and shown together with uncollected insurance premiums in Fiduciary assets in our Condensed Consolidated Statements of Financial Position, with a corresponding amount in Fiduciary liabilities.
In our capacity as an insurance broker or agent, we collect premiums from insureds and, after deducting our commission, remit the premiums to the respective insurance underwriters. We also collect claims or refunds from underwriters on behalf of insureds, which are then returned to the insureds. Unremitted insurance premiums and claims are held by us in a fiduciary
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capacity. The levels of funds held on behalf of clients and liabilities can fluctuate significantly depending on when we collect the premiums, claims, and refunds, make payments to underwriters and insureds, and collect funds from clients and make payments on their behalf, and upon the impact of foreign currency movements. Funds held on behalf of clients, because of their nature, are generally invested in highly liquid securities with highly rated, credit-worthy financial institutions. Fiduciary assets include funds held on behalf of clients of $7.3 billion and $6.9 billion at June 30, 2024 and December 31, 2023, respectively, and fiduciary receivables of $11.6 billion and $9.4 billion at June 30, 2024 and December 31, 2023, respectively. While we earn investment income on the funds held in cash and money market funds, the funds cannot be used for general corporate purposes.
We maintain multicurrency cash pools with third-party banks in which various Aon entities participate. Individual Aon entities are permitted to overdraw on their individual accounts provided the overall global balance does not fall below zero. At June 30, 2024, cash balances of one or more non-U.S. entities may have been negative; however, the overall balance was positive.
The following table summarizes our Cash and cash equivalents, Short-term investments, and Fiduciary assets as of June 30, 2024 (in millions):
 Statement of Financial Position Classification 
Asset TypeCash and Cash
Equivalents		Short-term
Investments		Fiduciary
Assets		Total
Certificates of deposit, bank deposits, or time deposits$974 $— $4,508 $5,482 
Money market funds— 182 2,801 2,983 
Cash, Short-term investments, and funds held on behalf of clients974 182 7,309 8,465 
Fiduciary receivables— — 11,556 11,556 
Total$974 $182 $18,865 $20,021 
Cash and cash equivalents and funds held on behalf of clients, including $38 million of cash and cash equivalents and funds held on behalf of clients classified as held for sale, increased $599 million in 2024. A summary of our cash flows provided by and used for operating, investing, and financing activities is as follows (in millions):
 Six Months Ended June 30,
20242023
Cash provided by operating activities$822 $1,131 
Cash provided by (used for) investing activities$(2,285)$128 
Cash provided by (used for) financing activities$2,264 $(39)
Effect of exchange rates on cash and cash equivalents and funds held on behalf of clients$(202)$203 
Net increase in cash and cash equivalents and funds held on behalf of clients$599 $1,423 
Operating Activities
Net cash provided by operating activities during the six months ended June 30, 2024 decreased $309 million from the prior year period to $822 million. This amount represents Net income reported, generally adjusted for gains from sales of businesses, losses from sales of businesses, share-based compensation expense, depreciation expense, amortization and impairments, and other non-cash income and expenses, including pension settlement charges. Adjustments also include changes in working capital, that relate primarily to the timing of payments of accounts payable and accrued liabilities, collection of receivables, and payments for Accelerating Aon United Program expenses.
Pension Contributions
Pension contributions were $27 million for the six months ended June 30, 2024, as compared to $31 million for the six months ended June 30, 2023. For the remainder of 2024, we expect to contribute approximately $41 million in cash to our pension plans, including contributions to non-U.S. pension plans, which are subject to changes in foreign exchange rates.
Accelerating Aon United Program Expenses
In the third quarter of 2023, we initiated the Accelerating Aon United Program (the “Program”) with the purpose of streamlining our technology infrastructure, optimizing our leadership structure and resource alignment, and reducing our real estate footprint to align to our hybrid working strategy. The Program includes technology-related costs to facilitate streamlining and simplifying operations, headcount reduction costs, and costs associated with asset impairments, including real estate consolidation and technology costs.
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Program charges are recognized within the Program’s expenses on the accompanying Condensed Consolidated Statements of Income and consists of the following cost activities:
•Technology and other – includes costs associated with actions taken to rationalize certain applications and to optimize technology across the Company. These costs may include contract termination fees and other non-capitalizable costs associated with Program initiatives, which include professional service fees.
•Workforce optimization – includes costs associated with headcount reduction and other separation-related costs.
•Asset impairments – includes costs associated with impairment of assets, as they are identified, including ROU lease assets, leasehold improvements, and other capitalized assets no longer providing economic benefit.
The changes in the Company’s liabilities for the Program as of June 30, 2024 are as follows (in millions):
Technology and otherWorkforce optimizationAsset impairmentsTotal
Liability Balance as of January 1, 2024$14 $86 $— $100 
Charges51 145 55 251 
Cash payments(29)(69)— (98)
Foreign currency translation and other— (3)— (3)
Non-cash charges (1)
(27)(10)(55)(92)
Liability balance as of June 30, 2024
$9 $149 $— $158 
Total costs incurred from inception to date$65 $248 $73 $386 
(1)During the three and six months ended June 30, 2024, the Company recognized $12 million and $20 million, respectively, of accelerated ROU asset amortization or impairments due to the Company’s decision to exit certain leased properties as a result of the AAU Program. The amounts are presented in Technology and other, where the corresponding liability is reflected within Other current liabilities and Non-current operating lease liabilities, which will ultimately be settled in cash.
The Program is currently expected to result in cumulative costs of approximately $1.0 billion, consisting of approximately $900 million of cash charges and approximately $100 million of non-cash charges. The Program is estimated to generate annualized expense savings of approximately $350 million by the end of 2026, largely benefiting Compensation and benefits, Information technology, and Premises on the Condensed Consolidated Statements of Income. For the three and six months ended June 30, 2024, total Program costs incurred were $132 million and $251 million, respectively. The Company expects to continue to review the implementation of elements of the Program throughout the course of the Program and, therefore, there may be changes to expected timing, estimates of expected costs and related savings. We estimate that expense savings resulting from Program actions taken in 2023 have begun to be realized in 2024, including $25 million and $45 million of savings realized in the first three and six months of 2024, respectively, the majority of which are recognized within Compensation and benefits on the Condensed Consolidated Statements of Income.
Investing Activities
Cash flows used for investing activities was $2.3 billion during the six months ended June 30, 2024, a decrease of $2.4 billion compared to $128 million of Cash flow provided by investing activities in the prior year period. Generally, the primary drivers of cash flows used for investing activities are acquisition of businesses, purchases of short-term investments, capital expenditures, and payments for investments. Generally, the primary drivers of cash flows provided by investing activities are sales of businesses, including collection of deferred consideration in connection with prior year business divestitures, sales of short-term investments, and proceeds from investments. The gains and losses corresponding to cash flows provided by proceeds from investments and used for payments for investments are primarily recognized in Other income (expense) in our Condensed Consolidated Statements of Income.
Short-term Investments
As of June 30, 2024, short-term investments decreased $187 million to $182 million compared to December 31, 2023. The majority of our investments carried at fair value are money market funds. These money market funds are held throughout the world with various financial institutions. We are not aware of any market liquidity issues that would materially impact the fair value of these investments.
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Acquisitions and Dispositions of Businesses
During the first six months of 2024, we completed eight acquisitions. Cash consideration, net of cash and funds held on behalf of clients acquired, was $2.8 billion, which includes $3 million related to acquisitions completed in 2023. During the first six months of 2023, we completed one acquisition. Cash consideration, net of cash and funds held on behalf of clients acquired, was $8 million, which includes $2 million related to acquisitions completed in 2022.
During the first six months of 2024, we completed two dispositions for $270 million, net of cash and funds held on behalf of clients. Additionally, we received $82 million of cash related to the deferred consideration earned in the first six months of 2024 for the 2017 sale of the benefits administration and business process outsourcing business. During the first six months of 2023, no businesses were sold, however, there was a $1 million impact, net of cash and funds held on behalf of clients, to the Condensed Consolidated Statements of Cash Flows related to dispositions completed in 2022.
Capital Expenditures
Our additions to fixed assets, including capitalized software, amounted to $101 million and $145 million for the six months ended June 30, 2024 and 2023, respectively, which primarily relate to the refurbishing and modernizing of office facilities, software development costs, and computer equipment purchases. In the current period, we continue to support certain technology projects to drive long-term growth and real estate projects to align with our Smart Working strategy.
Financing Activities
Cash flows provided by financing activities during the six months ended June 30, 2024 was $2.3 billion compared to $39 million of Cash flows used for financing activities in the prior year period. Generally, the primary drivers of cash flows used for financing activities are repayments of debt, partially related to the cash tender offer for the NFP Notes, share repurchases, cash paid for employee taxes on withholding shares, dividends paid to shareholders, transactions with noncontrolling interests, and other financing activities, such as payments for deferred consideration in connection with prior year business acquisitions. Generally, the primary drivers of cash flow provided by financing activities are issuances of debt, changes in net fiduciary liabilities, and proceeds from issuance of shares.
We have a share repurchase program authorized by our Board of Directors. 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, June 2017, and November 2020, and by $7.5 billion in February 2022 for a total of $27.5 billion in repurchase authorizations.
The following table summarizes our share repurchase activity (in millions, except per share data):
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
Shares repurchased0.8 1.7 1.6 3.5 
Average price per share$298.09 $323.96 $304.20 $314.36 
Repurchase costs recorded to accumulated deficit
$250 $550 $500 $1,100 
8.205% Junior Subordinated Notes due January 20274.50% Senior Notes due December 20283.75% Senior Notes due May 20292.80% Senior Notes due May 20306.25% Senior Notes due September 2040
All guarantees of Aon plc, Aon Global Limited, Aon North America, Inc., and Aon Global Holdings plc of the Aon Corporation Notes are joint and several as well as full and unconditional. Senior Notes rank pari passu in right of payment with all other present and future unsecured debt which is not expressed to be subordinate or junior in rank to any other unsecured debt of Aon Corporation. There are no subsidiaries other than those listed above that guarantee the Aon Corporation Notes.
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Newly issued and outstanding debt securities by Aon Global Limited are guaranteed by Aon plc, Aon Global Holdings plc, Aon North America, Inc., and Aon Corporation, and include the following (collectively, the “Aon Global Limited Notes”):
Aon Global Limited Notes
3.875% Senior Notes due December 2025
2.875% Senior Notes due May 2026
4.25% Senior Notes due December 2042
4.45% Senior Notes due May 2043
4.60% Senior Notes due June 2044
4.75% Senior Notes due May 2045
All guarantees of Aon plc, Aon Global Holdings plc, Aon North America, Inc., and Aon Corporation of the Aon Global Limited Notes are joint and several as well as full and unconditional. Senior Notes rank pari passu in right of payment with all other present and future unsecured debt which is not expressed to be subordinate or junior in rank to any other unsecured debt of Aon Global Limited. There are no subsidiaries other than those listed above that guarantee the Aon Global Limited Notes.
Newly issued and outstanding debt securities by Aon North America, Inc. are guaranteed by Aon Global Limited, Aon plc, Aon Global Holdings plc, and Aon Corporation, and include the following (collectively, the “Aon North America, Inc. Notes”):
Aon North America, Inc. Notes
5.125% Senior Notes due March 2027
Delayed Draw Term Loan due April 2027
5.150% Senior Notes due March 2029
5.300% Senior Notes due March 2031
5.450% Senior Notes due March 2034
5.750% Senior Notes due March 2054
All guarantees of Aon Global Limited, Aon plc, Aon Global Holdings plc, and Aon Corporation of the Aon North America, Inc. Notes are joint and several as well as full and unconditional. Senior Notes rank pari passu in right of payment with all other present and future unsecured debt which is not expressed to be subordinate or junior in rank to any other unsecured debt of Aon North America, Inc. There are no subsidiaries other than those listed above that guarantee the Aon North America, Inc. Notes.
Newly co-issued and outstanding debt securities by Aon Corporation and Aon Global Holdings plc (together, the “Co-Issuers”) are guaranteed by Aon plc, Aon North America, Inc., and Aon Global Limited and include the following (collectively, the “Co-Issued Notes”):
Co-Issued Notes - Aon Corporation and Aon Global Holdings plc
2.85% Senior Notes due May 2027
2.05% Senior Notes due August 2031
2.60% Senior Notes due December 2031
5.00% Senior Notes due September 2032
5.35% Senior Notes due February 2033
2.90% Senior Notes due August 2051
3.90% Senior Notes due February 2052
All guarantees of Aon plc, Aon Global Limited, and Aon North America, Inc. of the Co-Issued Notes are joint and several as well as full and unconditional. Senior Notes rank pari passu in right of payment with all other present and future unsecured debt which is not expressed to be subordinate or junior in rank to any other unsecured debt of the Co-Issuers. There are no subsidiaries other than those listed above that guarantee the Co-Issued Notes.
Aon Corporation, Aon North America, Inc., Aon Global Limited, and Aon Global Holdings plc are indirect wholly owned subsidiaries of Aon plc. Aon plc, Aon Global Limited, Aon Global Holdings plc, Aon North America, Inc., and Aon
47

Corporation together comprise the revised “Obligor group”. The following tables set forth summarized financial information for the revised Obligor group, which reflects the financial results of Aon North America, Inc. for the year ended December 31, 2023 and for the period ended June 30, 2024.
Adjustments are made to the tables to eliminate intercompany balances and transactions between the revised Obligor group. Intercompany balances and transactions between the revised Obligor group and non-guarantor subsidiaries are presented as separate line items within the summarized financial information. These balances are presented on a net presentation basis, rather than a gross basis, as this better reflects the nature of the intercompany positions and presents the funding or funded position that is to be received or owed. No balances or transactions of non-guarantor subsidiaries are presented in the summarized financial information, including investments of the revised Obligor group in non-guarantor subsidiaries.
Obligor Group
Summarized Statement of Income Information
Six Months Ended
(millions)June 30, 2024
Revenue$— 
Operating loss$(59)
Expense from non-guarantor subsidiaries before income taxes$28 
Net loss$(377)
Net loss attributable to Aon shareholders$(377)

Obligor Group
Summarized Statement of Financial Position Information
As ofAs of
(millions)June 30, 2024December 31, 2023
Receivables due from non-guarantor subsidiaries$12,052 $1,431 
Other current assets43 230 
Total current assets$12,095 $1,661 
Non-current receivables due from non-guarantor subsidiaries$10,864 $10,873 
Other non-current assets1,289 1,228 
Total non-current assets$12,153 $12,101 
Payables to non-guarantor subsidiaries$7,475 $3,750 
Other current liabilities4,833 4,987 
Total current liabilities$12,308 $8,737 
Non-current payables to non-guarantor subsidiaries$11,128 $10,933 
Other non-current liabilities19,036 11,447 
Total non-current liabilities$30,164 $22,380 
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
There have been no changes to our critical accounting policies, which include revenue recognition, pensions, goodwill and other intangible assets, contingencies, share-based payments, income taxes, and Accelerating Aon United restructuring charges as discussed in our Annual Report on Form 10-K for the year ended December 31, 2023.
NEW ACCOUNTING PRONOUNCEMENTS
Note 2 “Accounting Principles and Practices” to our Financial Statements contained in Part I, Item 1 of this report contains a discussion of recently issued accounting pronouncements and Securities and Exchange Commission final rules and their future potential impact on our financial results or disclosures, if determinable.
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Item 3.  Quantitative and Qualitative Disclosures about Market Risk
We are exposed to potential fluctuations in earnings, cash flows, and the fair values of certain of our assets and liabilities due to changes in interest rates and foreign exchange rates. To manage the risk from these exposures, we enter into a variety of derivative instruments. We do not enter into derivatives or financial instruments for trading or speculative purposes.
The following discussion describes our specific exposures and the strategies we use to manage these risks. Refer to Note 2 “Summary of Significant Accounting Principles and Practices” in the Notes to Consolidated Financial Statements as discussed in Part II, Item 8 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 for a discussion of our accounting policies for financial instruments and derivatives.
Foreign Exchange Risk
We are subject to foreign exchange rate risk. Our primary exposures include exchange rates between the U.S. dollar and the euro, the British pound, the Canadian dollar, the Australian dollar, the Indian rupee, and the Japanese yen. We use over-the-counter options and forward contracts to reduce the impact of foreign currency risk to our financial statements.
Additionally, some of our non-U.S. brokerage subsidiaries receive revenue in currencies that differ from their functional currencies. Our U.K. subsidiaries earn a portion of their revenue in U.S. dollars, euro, and Japanese yen, but most of their expenses are incurred in British pounds. At June 30, 2024, we have hedged approximately 45% of our U.K. subsidiaries’ expected exposures to U.S. dollar, euro, and Japanese yen transactions for the years ending December 31, 2024 and 2025, respectively. We generally do not hedge exposures beyond three years.
We also use forward and option contracts to economically hedge foreign exchange risk associated with monetary balance sheet exposures, such as intercompany notes and current assets and liabilities that are denominated in a non-functional currency and are subject to remeasurement.
The translated value of revenues and expenses from our international brokerage operations are subject to fluctuations in foreign exchange rates. If we were to hypothetically translate prior year results at current quarter exchange rates, diluted earnings per share would have an unfavorable $0.05 comparable impact and an unfavorable $0.04 comparable impact during the three and six months ended June 30, 2024, respectively. Further, adjusted diluted earnings per share, a non-GAAP measure as defined and reconciled under the caption “Review of Consolidated Results — Adjusted Diluted Earnings Per Share,” would have an unfavorable $0.06 comparable impact and an unfavorable $0.04 comparable impact during the three and six months ended June 30, 2024, respectively, if we were to hypothetically translate prior year results at current quarter exchange rates.
Interest Rate Risk
Our fiduciary investment income is affected by changes in international and domestic short-term interest rates. We monitor our net exposure to short-term interest rates and, as appropriate, hedge our exposure with various derivative financial instruments. This activity primarily relates to brokerage funds held on behalf of clients in the U.S. and in continental Europe. A decrease in global short-term interest rates adversely affects our fiduciary investment income.
Item 4.   Controls and Procedures
Evaluation of disclosure controls and procedures. We have conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this quarterly report of June 30, 2024. Based on this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were effective such that the information relating to Aon, including our consolidated subsidiaries, required to be disclosed in our SEC reports is recorded, processed, summarized and reported within the time periods specified in appropriate statute, SEC rules and forms, and is accumulated and communicated to Aon’s management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.
Changes in internal control over financial reporting. On April 25, 2024, Aon completed its acquisition of NFP. Aon is in the process of assessing NFP’s internal controls over financial reporting and will make appropriate changes as NFP is integrated into the Company’s internal controls over financial reporting. There were no other changes in Aon’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during the quarter ended June 30, 2024 that have materially affected, or that are reasonably likely to materially affect, Aon’s internal control over financial reporting.
49

Part II Other Information
Item 1. Legal Proceedings
See Note 15 “Claims, Lawsuits, and Other Contingencies” to our Financial Statements contained in Part I, Item 1 of this report, which is incorporated by reference herein.
Item 1A. Risk Factors
The risk factors set forth in the “Risk Factors” section in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023 and the risk factors set forth under the headings “Risks Related to Aon and the NFP business after Completion of the Transaction” and Risks Related to NFP’s Business in our registration statement on Form S-4 effective April 23, 2024, which are incorporated by reference herein, reflect certain risks associated with existing and potential lines of business and contain “forward-looking statements” as discussed in “Information Concerning Forward-Looking Statements” elsewhere in this report. Readers should consider them in addition to the other information contained in this report as our business, financial condition or results of operations could be adversely affected if any of these risks actually occur.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Issuer Purchases of Equity Securities
The following information relates to the purchase of equity securities by Aon or any affiliated purchaser during each month within the second quarter of 2024:
PeriodTotal Number of Shares Purchased
Average Price Paid per Share (1)
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2)
Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (1)(2)
4/1/24 - 4/30/24363,783 $306.75 363,783 $2,955,678,198 
5/1/24 - 5/31/24135,276 $283.93 135,276 $2,917,269,662 
6/1/24 - 6/30/24339,600 $294.45 339,600 $2,817,273,245 
838,659 $298.09 838,659 $2,817,273,245 
(1)Does not include commissions paid to repurchase shares.
(2)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, June 2017, and November 2020, and by $7.5 billion in February 2022 for a total of $27.5 billion in repurchase authorizations.
Unregistered Sales of Equity Securities
We did not make any unregistered sales of equity in the second quarter of 2024.
Item 3. Defaults Upon Senior Securities
Not Applicable.
Item 4. Mine Safety Disclosures
Not Applicable.
Item 5. Other Information
Not Applicable.
Item 6. Exhibits
Exhibits — The exhibits filed with this report are listed on the attached Exhibit Index.
50

Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 Aon plc
 (Registrant)
  
July 26, 2024By:/s/ Michael Neller
 Michael Neller
 SENIOR VICE PRESIDENT AND
 GLOBAL CONTROLLER
 (Principal Accounting Officer and duly authorized officer of Registrant)
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Exhibit Index
Exhibit Number Description of Exhibit
2.1
3.1
10.1#
10.2#
10.3#
10.4#+
10.5
10.6
10.7
22.1*
31.1*
31.2*
32.1*
32.2*
101*Interactive Data Files. The following materials are filed electronically with this Quarterly Report on Form 10-Q:
 101.SCH XBRL Taxonomy Extension Schema Document
 101.CAL XBRL Taxonomy Calculation Linkbase Document
 101.DEF XBRL Taxonomy Definition Linkbase Document
 101.PRE XBRL Taxonomy Presentation Linkbase Document
 101.LAB XBRL Taxonomy Calculation Linkbase Document
104Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
 * Filed herewith
 # Indicates a management contract or compensatory plan or arrangement
 + Certain schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company agrees to furnish supplementally a copy of such schedules and exhibits, or any section thereof, to the SEC upon request.

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