I downloaded the ISO kali-linux-2016.2-amd64.iso and used dd to create
a bootable flash drive. Works great.

Then ran the command cat /etc/*release to obtain verify I had the
right ISO after the install. I was surprised to see that the returns
for "Version" and "Version ID" were 2016.1. Is this a typo or
did the version number not increment?

The results are shown below:

root@kali:~# cat /etc/*release
DISTRIB_ID=Kali
DISTRIB_RELEASE=kali-rolling
DISTRIB_CODENAME=kali-rolling
DISTRIB_DESCRIPTION="Kali GNU/Linux Rolling"
PRETTY_NAME="Kali GNU/Linux Rolling"
NAME="Kali GNU/Linux"
ID=kali
VERSION="2016.1"
VERSION_ID="2016.1"
ID_LIKE=debian
ANSI_COLOR="1;31"
HOME_URL="http://www.kali.org/"
SUPPORT_URL="http://forums.kali.org/"
BUG_REPORT_URL="http://bugs.kali.org/"

Thanks in advance.

Bill