v3.26.1
Fair Value Measurements and Investments (Tables)
 3 Months Ended
Mar. 31, 2026
Fair Value Disclosures [Abstract]  
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis

The following tables present our assets and liabilities measured at fair value on a recurring basis at March 31, 2026 and December 31, 2025:

 

 

 

 

 

Fair Value Measurements on a Recurring Basis at
March 31, 2026

 

 

 

Balance Sheet Location

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mutual funds/exchange traded funds (i)

 

Prepaid and other current assets and Other non-current assets

 

$

143

 

 

$

—

 

 

$

—

 

 

$

143

 

 

 

Fiduciary assets

 

 

452

 

 

 

—

 

 

 

—

 

 

 

452

 

Commingled funds (i) (ii)

 

Prepaid and other current assets and Other non-current assets

 

 

—

 

 

 

—

 

 

 

—

 

 

 

21

 

Hedge funds (i) (iii)

 

Prepaid and other current assets and Other non-current assets

 

 

—

 

 

 

—

 

 

 

—

 

 

 

21

 

Derivatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments (iv)

 

Prepaid and other current assets and Other non-current assets

 

$

—

 

 

$

2

 

 

$

—

 

 

$

2

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contingent consideration:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contingent consideration (v)

 

Other current liabilities and Other non-current liabilities

 

$

—

 

 

$

—

 

 

$

32

 

 

$

32

 

Derivatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments (iv)

 

Other current liabilities and Other non-current liabilities

 

$

—

 

 

$

10

 

 

$

—

 

 

$

10

 

 

 

 

 

 

 

Fair Value Measurements on a Recurring Basis at
December 31, 2025

 

 

 

Balance Sheet Location

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mutual funds/exchange traded funds (i)

 

Prepaid and other current assets and Other non-current assets

 

$

145

 

 

$

—

 

 

$

—

 

 

$

145

 

 

 

Fiduciary assets

 

 

448

 

 

 

—

 

 

 

—

 

 

 

448

 

Commingled funds (i) (ii)

 

Prepaid and other current assets and Other non-current assets

 

 

—

 

 

 

—

 

 

 

—

 

 

 

31

 

Hedge funds (i) (iii)

 

Prepaid and other current assets and Other non-current assets

 

 

—

 

 

 

—

 

 

 

—

 

 

 

28

 

Derivatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments (iv)

 

Prepaid and other current assets and Other non-current assets

 

$

—

 

 

$

5

 

 

$

—

 

 

$

5

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contingent consideration:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contingent consideration (v)

 

Other current liabilities and Other non-current liabilities

 

$

—

 

 

$

—

 

 

$

14

 

 

$

14

 

Derivatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments (iv)

 

Other current liabilities and Other non-current liabilities

 

$

—

 

 

$

1

 

 

$

—

 

 

$

1

 

 

(i)
With the exception of the funds included in fiduciary assets, the majority of these balances are held as part of deferred compensation plans with related liabilities in other current liabilities and other non-current liabilities on the condensed consolidated balance sheets.
(ii)
Consists of the Towers Watson Global Equity Focus Fund, for which redemptions can occur on any business day, and require a minimum of one business day’s notice.
(iii)
Consists of the Towers Watson Alternative Credit Fund, for which the redemption period is generally quarterly, however requires a 50-day notice.
(iv)
See Note 8 — Derivative Financial Instruments for further information on our derivative contracts.
(v)
Consideration due to be paid across multiple years until 2029. Probability weightings are based on our knowledge of the past and planned performance of the acquired entity to which the contingent consideration applies. The fair value weighted-average discount rates used in our material contingent consideration calculations were 9.87% and 11.00% at March 31, 2026 and December 31, 2025, respectively. The range of these discount rates was 9.60% - 11.00% at March 31, 2026. Using different probability weightings and discount rates could result in an increase or decrease of the contingent consideration payable.
Schedule of Change in Fair Value of Level 3 Liabilities

The following table summarizes the change in fair value of the Level 3 liabilities:

 

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)

 

March 31, 2026

 

Balance at December 31, 2025

 

$

14

 

Obligations assumed

 

 

18

 

Payments

 

 

—

 

Realized and unrealized losses (i)

 

 

—

 

Foreign exchange

 

 

—

 

Balance at March 31, 2026

 

$

32

 

 

(i)
Realized and unrealized losses include accretion and adjustments to contingent consideration liabilities, which are included within Interest expense and Other operating expenses, respectively, on the condensed consolidated statements of comprehensive income.
Summarizes the Types of Holdings and Related Values The following table summarizes the types of holdings and related values:

 

Held-to-Maturity Securities

 

Corporate securities

 

Amortized cost basis

 

$

51

 

Allowance for credit losses

 

 

—

 

Net carrying amount

 

 

51

 

Gross unrealized gains

 

 

—

 

Gross unrealized losses

 

 

—

 

Aggregate fair value

 

$

51

 
Schedule of Assets and Liabilities Whose Carrying Values Differ From the Fair Value and are Not Measured on a Recurring Basis

The following tables present our assets and liabilities not measured at fair value on a recurring basis at March 31, 2026 and December 31, 2025:

 

 

 

March 31, 2026

 

 

December 31, 2025

 

 

 

Carrying Value

 

 

Fair Value

 

 

Carrying Value

 

 

Fair Value

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Held-to-maturity securities:

 

 

 

 

 

 

 

 

 

 

 

 

Due in one year or less

 

$

8

 

 

$

8

 

 

$

8

 

 

$

8

 

Due in one year through five years

 

$

42

 

 

$

42

 

 

$

42

 

 

$

42

 

Due in greater than five years

 

$

1

 

 

$

1

 

 

$

1

 

 

$

1

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Current debt

 

$

—

 

 

$

—

 

 

$

550

 

 

$

550

 

Long-term debt

 

$

6,304

 

 

$

6,075

 

 

$

5,756

 

 

$

5,618