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AECOM
   1999 Avenue of the
   Stars
   Suite 2600
   Los Angeles, CA
   90067
   www.aecom.com

213.593.8000
   213.593.8730

tel
   fax

February 24, 2017

VIA EDGAR

Terence O’Brien

Accounting Branch Chief

Securities and Exchange Commission

Division of Corporation Finance

1 Station Place, N.E., Stop 7010

Washington, D.C. 20549

Re:                             AECOM

Form 10-K for Fiscal Year Ended September 30, 2016

Filed November 16, 2016

File No. 0-52423

Dear Mr. O’Brien:

This letter is in response to the comment letter, dated January 27, 2017, of the Staff of the Division of Corporation Finance (the “Staff”) regarding the above-referenced filing (the “Filing”) for AECOM (the “Company” or “AECOM”).  To assist your review, we have retyped the text of the Staff’s comments in italics below.

Form 10-K for the fiscal year ended September 30, 2016

Management’s Discussion and Analysis of Financial Condition and Results of Operations, page 37

Consolidated Results, page 45

1.              As previously requested, please provide an analysis of the material factors impacting the effective tax rate for each period presented, including whether the factors are expected to have a continuing impact.  Other than your analysis of the reversal of the valuation allowance, it would appear an analysis should have been provided for the exclusion of tax on non-controlling interests, income tax credits and incentives, foreign tax rate differential, tax exempt income, changes in tax rates, and foreign residual income line items from your reconciliation on page 112. Please refer to Item 303(a)(3) of Regulation S-K and Section 501.12.b.4. of the Financial Reporting Codification for guidance along with comment 3 in our letter dated December 17, 2015, and your corresponding response letter dated January 20, 2016.

1

AECOM’s Response to Question 1

The Company respectfully submits that it will provide a more comprehensive analysis of the material factors impacting its effective tax rate for each period presented by quantifying and discussing the impact of each such factor, including whether the factor is expected to have a continuing impact to the effective tax rate. The material factors contributing to the difference between the statutory U.S. federal income tax rate of 35% and the Company’s effective tax rate for the year ended September 30, 2016, were the valuation allowance reversal, exclusion of tax on non-controlling interests, income tax credits and incentives, foreign tax rate differential, tax exempt income, changes in tax rates and foreign residual income. All of these material factors are expected to have a continuing impact on the effective tax rate except for the impact of the retroactive reinstatement of the federal research credit and the release of certain valuation allowances in the United Kingdom and Australia.  The material factors impacting the effective tax rate for the year ended September 30, 2015, were presented in the Consolidated Results, page 54 and include the exclusion of tax on non-controlling interests, geographical mix of earnings, energy-related and other tax incentives, the reinstatement of expiring tax provisions, valuation allowance activity and the domestic production activities deduction.

The Company has included additional disclosure related to the material factors impacting its effective tax rate in its most recently filed 10-Q for the period ending December 31, 2016.  The Company will continue to refer to Item 303(a)(3) of Regulation S-K and Sections 501.12.b.3 and 501.12.b.4 of the Financial Reporting Codification for guidance.  The below underlined text reflects the form of additional language that the Company proposes to include in its next Form 10-K in its results of operations, and comparable language will be included in future filings, if applicable.

Included in our income tax benefit for the year ended September 30, 2016, is a total benefit of $54.7 million related to valuation allowance activity including decreases in valuation allowances due to current year foreign income and the release of certain valuation allowances in the United Kingdom and Australia (see paragraphs below for further details), a $24.7 million benefit related to non-controlling interests, a $24.6 million benefit related to income tax credits and energy-related incentives, a $19.7 million benefit of the effect of the favorable tax impacts of changes in the geographical mix of income, and a $17.6 million benefit related to tax-exempt income, partially offset by a $32.6 million increase in tax expense related to the impact of tax rate changes in certain foreign jurisdictions and $17.8 million of tax expense related to foreign residual income.  All of these factors are expected to have a continuing impact on the effective tax rate except for the impact of the retroactive reinstatement of the federal research credit, the release of certain valuation allowances in the United Kingdom and Australia and the impact of tax rate changes.

Note 6- Joint Ventures and Variable Interest Entities, page 93

2.              We note that equity in earnings of joint ventures is 83% of income before income tax (benefit) expense. Please confirm that none of your equity method investments meet the significance thresholds referenced in Article 3-09 of Regulation S-X for any of the three fiscal years presented.

2

AECOM’s Response to Question 2

The Company respectfully confirms with the Staff that none of its equity method investments meet the significance thresholds referenced in Article 3-09 of Regulation S-X for any of the three fiscal years presented.  As discussed in Footnote 6 of its 10-K, the Company has significant operations through equity method investments and provides necessary disclosures in accordance with Article 4-08(g) of Regulation S-X.  However, none of the individual equity method investees rose to the level of significance to require disclosure in accordance with Article 3-09.

Note 16 — Other Financial Information, page 117

3.              We note your disclosure that you recorded revenue and a non-current asset related to the expected accelerated recovery of a pension related entitlement from the federal government of approximately $50 million. Please tell us and expand your disclosures to discuss the nature and reasons behind the entitlement and the facts and circumstances that gave rise to its recovery from the federal government. In providing your response, please tell us how you determined the entitlement met the characteristics to be classified as revenue.

AECOM’s Response to Question 3

As noted in Footnote 7 to the Company’s Form 10-K, the Company adopted an amendment to freeze benefits under the URS Federal Services, Inc. Employee Retirement Plan (the “Plan”) during fiscal 2015.  Substantially all of URS Federal Services, Inc.’s contracts were with the US Federal Government (the “Government”), and a substantial portion of pension expenses related to the Plan were included as a cost element to the Government under Cost Accounting Standards (“CAS”).  In accordance with CAS 413-50-(c)(12), curtailment of the Plan resulted in an acceleration of the Government’s obligation to fund its portion of the Plan.  Based on the Company’s estimates and independent third party actuarial estimates, the Government’s portion of Plan expenses accelerated due to the curtailment was approximately $50 million. The Company also obtained advice from outside counsel confirming that the Company had a legal right to an accelerated recovery in accordance with CAS 413-50-(c)(12). An invoice for settlement and adjustment of pension cost was developed, certified per Defense Federal Acquisition Regulation Supplement 252.243-7002, and submitted to the Government in accordance with CAS 413-50(c)(12) and Federal Acquisition Regulation 31.205-6(j).

The Company concluded the amount due from the Government under CAS 413 should be recorded as revenue to be consistent with the Company’s existing accounting policy and application of GAAP.  During the normal course of business, these pension costs are pooled with other indirect costs and billed to the Government as overhead rates that are recognized as revenue. Accordingly, absent the curtailment, Plan costs would have been recovered from the Government through the Company’s rates charged on applicable contracts and recorded as revenue.  The Company concluded the entitlement represented payments from a customer for services rendered and should be recorded as revenue.

3

The below underlined text reflects the form of additional language that the Company proposes to include in future filings:

During the twelve months ended September 30, 2016, the Company recorded revenue related to the expected accelerated recovery of a pension related entitlement from the federal government of approximately $50 million.  The entitlement resulted from pension costs that are reimbursable through certain government contracts in accordance with Cost Accounting Standards. The accelerated recognition resulted from an amendment to freeze pension benefits under the URS Federal Services, Inc. Employees Retirement Plan.  The actual amount of reimbursement may vary from the Company’s expectation.

Item 9A. Controls and Procedures, page 135

4.              Please tell us how you determined that the material weakness identified as of September 30, 2015, did not impact your conclusion regarding the effectiveness of your disclosure controls and procedures, as defined in Exchange Act Rules 13a-15(e) and 15d-15(e). Please also refer to SEC Release No. 33-8238, Final Rule: Management’s Report on Internal Control Over Financial Reporting and Certification of Disclosure in Exchange Act Periodic Reports, which states that disclosure controls and procedures will include those components of internal control over financial reporting that provide reasonable assurances that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles.

AECOM’s Response to Question 4

Rule 13a-15(d) of the Securities Exchange Act of 1934 defines “disclosure controls and procedures” to mean controls and procedures designed to ensure that information required to be disclosed in Exchange Act reports is recorded, processed, summarized and reported within the SEC designated time periods (the “Disclosure Controls”).  The Company’s Disclosure Controls were designed to include controls and procedures to ensure that information is accumulated and communicated to the Company’s principal executive and principal financial officers, as appropriate, to allow timely decisions about required disclosure.  Internal Control over Financial Reporting (“ICFR”), comparatively, are considered to be a subset of the Company’s Disclosure Controls and were designed to provide reasonable assurance regarding the reliability of its financial reporting and the preparation of its financial statements for external purposes in accordance with GAAP.

The Company’s principal executive officer and principal financial officer concluded that its Disclosure Controls for its fiscal year ended September 30, 2015 remained effective because throughout this period there existed established processes and procedures to ensure that all information was properly recorded, processed, summarized and reported.  These processes and procedures, included, but were not limited to (1) a comprehensive review of the Company’s periodic reports by its functional groups, including Accounting, Legal, Tax, Investor Relations, Treasury, Internal Audit and others; (2) officer subcertificates by key managers of the Company’s various functional groups; (3) formal review of the periodic report and ICFR at the Company’s disclosure committee meeting by the principal executive and principal financial officers and other senior managers; (4) detailed review of the non-financial information, including board and executive level materials; and (5) the timely reporting of all information in the periodic report.

4

The Company’s principal executive and principal financial officers also considered that the identified material weakness in the ICFR was isolated to technical accounting issues originating from a prior business combination outside of the Company’s Disclosure Controls.  While the Company ultimately determined to report a material weakness in ICFR, the Company reached its conclusion after careful consideration of judgmental factors based on technical accounting issues originating from a prior business combination that was subject to substantial internal debate.  However, as to the broader question of Disclosure Controls, the Company believes that effectiveness was not impacted because its circumstances were unique due to the nature of the deficiency being very narrow relative to its broader Disclosure Controls.

5.              We note that you amended your fiscal year 2015 Form 10-K on August 10, 2016, to identify a material weakness as of September 30, 2015. Please provide us with a comprehensive discussion of the control deficiencies and the nature of the material weakness, including when the material weakness first began, and how you discovered the control deficiencies that led to the material weakness. As part of your response, please tell us if these were identified control deficiencies as of September 30, 2015 or earlier that were not raised to the level of a material weakness until the filing of your amendment to the 2015 Form 10-K.

AECOM’s Response to Question 5

As noted in the disclosure in Form 10-K, the Company concluded a material weakness existed in its ICFR as of September 30, 2015 related to the acquisition (“Acquisition” or “Business Combination”) of URS Corporation (“URS”).  On October 17, 2014, the Company acquired a controlling interest in URS and completed the largest and most complex acquisition in the Company’s history.  No other significant acquisitions were made during fiscal years 2015 or 2016.  The measurement period for the Acquisition began on October 17, 2014.  The errors and related ICFR deficiencies that indicated a material weakness did not manifest until after the Form 10-K for the fiscal year ending on September 30, 2015 was filed.  Each of the errors and the associated ICFR deficiencies originated from the initial purchase accounting of the Acquisition as further documented below.

During the first quarter of fiscal year 2016, an error was detected in the Company’s income tax accounts originating from the Business Combination.  During the third quarter of fiscal year 2016, additional errors were identified related to the Business Combination, specifically adoption and application of forward loss policy and additional income tax matters also originating from the Business Combination.  A more detailed description of the errors is discussed in the response to Question #6 below.  Although the impact of the errors was not quantitatively material, individually or in aggregate, the Company considered the qualitative evidence that the existence of several errors and related ICFR deficiencies were present in the Business Combination process as of September 30, 2015.  Specifically, these deficient controls were the controls over aligning accounting policies of an acquired company, allocation of acquired deferred tax assets and liabilities by tax jurisdiction, and assessing the technical merits of acquired deferred tax assets and liabilities by jurisdiction.

The Company considered Rule 1-02(a)(4) that defines a material weakness as “a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.”  Based on the Company’s analysis, a reasonable possibilit