further , we undertake no obligation to update or revise any of our forward-looking statements whether as a result of new information , future events or otherwise . critical accounting policies our consolidated financial statements were prepared in accordance with accounting principles generally accepted in the united states . preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets , liabilities , revenues and expenses and the related disclosures of contingent assets and liabilities . we base our estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances . actual results may differ from estimates . 28 our significant accounting policies are discussed in note 2 to our consolidated financial statements . the accounting policies discussed below are both important to the presentation of our financial condition and results of operations and require management to make difficult , subjective or complex accounting estimates . accordingly , these critical accounting policies are reviewed periodically by the audit committee of the board of directors . regulation  our natural gas distribution and regulated transmission and storage operations are subject to regulation with respect to rates , service , maintenance of accounting records and various other matters by the respective regulatory authorities in the states in which we operate . we meet the criteria established within accounting principles generally accepted in the united states of a cost-based , rate-regulated entity , which requires us to reflect the financial effects of the ratemaking and accounting practices and policies of the various regulatory commissions in our financial statements in accordance with applicable authoritative accounting standards . we apply the provisions of this standard to our regulated operations and record regulatory assets for costs that have been deferred for which future recovery through customer rates is considered probable and regulatory liabilities when it is probable that revenues will be reduced for amounts that will be credited to customers through the ratemaking process . as a result , certain costs that would normally be expensed under accounting principles generally accepted in the united states are permitted to be capitalized or deferred on the balance sheet because it is probable they can be recovered through rates . discontinuing the application of this method of accounting for regulatory assets and liabilities could significantly increase our operating expenses as fewer costs would likely be capitalized or deferred on the balance sheet , which could reduce our net income . further , regulation may impact the period in which revenues or expenses are recognized . the amounts to be recovered or recognized are based upon historical experience and our understanding of the regulations . the impact of regulation on our regulated operations may be affected by decisions of the regulatory authorities or the issuance of new regulations . unbilled revenue  sales of natural gas to our natural gas distribution customers are billed on a monthly basis ; however , the billing cycle periods for certain classes of customers do not necessarily coincide with accounting periods used for financial reporting purposes . we follow the revenue accrual method of accounting for natural gas distribution segment revenues whereby revenues applicable to gas delivered to customers , but not yet billed under the cycle billing method , are estimated and accrued and the related costs are charged to expense . on occasion , we are permitted to implement new rates that have not been formally approved by our regulatory authorities , which are subject to refund . we recognize this revenue and establish a reserve for amounts that could be refunded based on our experience for the jurisdiction in which the rates were implemented . financial instruments and hedging activities  we use financial instruments to mitigate commodity price risk and interest rate risk . the objectives for using financial instruments have been tailored to meet the needs of our regulated and nonregulated businesses . these objectives are more fully described in note 4 to the consolidated financial statements . we record all of our financial instruments on the balance sheet at fair value as required by accounting principles generally accepted in the united states , with changes in fair value ultimately recorded in the income statement . market value changes result in a change in the fair value of these financial instruments . the recognition of the changes in fair value of these financial instruments are recorded in the income statement is contingent upon whether the financial instrument has been designated and qualifies as a part of a hedging relationship or if regulatory rulings require a different accounting treatment . we have elected to treat forward gas supply contracts used in our regulated operations to deliver gas as normal purchases and normal sales . financial instruments used to manage commodity price risk in our natural gas distribution segment do not impact this segment 's results of operations as the realized gains and losses are ultimately recovered from ratepayers through our rates . our nonregulated segment also utilizes financial instruments to manage commodity price risk . we have designated the natural gas inventory held by this operating segment as the hedged item in a fair-value hedge . the financial instruments associated with this natural gas inventory have been designated as fair-value hedges . changes in the fair value of the inventory and designated hedges are recognized in purchased gas cost in the period of change . 29 additionally , we have elected to treat fixed-price forward contracts used in our nonregulated segment to deliver gas as normal purchases and normal sales . financial instruments used to mitigate the commodity price risk associated with these contracts have been designated as cash flow hedges of anticipated purchases and sales at indexed prices . story_separator_special_tag our ability to earn our authorized rates is based primarily on our ability to improve the rate design in our various ratemaking jurisdictions by reducing or eliminating regulatory lag and , ultimately , separating the recovery of our approved margins from customer usage patterns . improving rate design is a long-term process and is further complicated by the fact that we operate in multiple rate jurisdictions . the ratemaking activity section of this form 10-k describes our current rate strategy , progress towards implementing that strategy and recent ratemaking initiatives in more detail . we are generally able to pass the cost of gas through to our customers without markup under purchased gas cost adjustment mechanisms ; therefore the cost of gas typically does not have an impact on our gross profit as increases in the cost of gas are offset by a corresponding increase in revenues . accordingly , we believe gross profit is a better indicator of our financial performance than revenues . however , gross profit in our texas and mississippi service areas include franchise fees and gross receipts taxes , which are calculated as a percentage of revenue ( inclusive of gas costs ) . therefore , the amount of these taxes included in revenues is influenced by the 34 cost of gas and the level of gas sales volumes . we record the tax expense as a component of taxes , other than income . although changes in revenue-related taxes arising from changes in gas costs affect gross profit , over time the impact is offset within operating income . as discussed above , the cost of gas typically does not have a direct impact on our gross profit . however , higher gas costs may adversely impact our accounts receivable collections , resulting in higher bad debt expense , and may require us to increase borrowings under our credit facilities resulting in higher interest expense . in addition , higher gas costs , as well as competitive factors in the industry and general economic conditions may cause customers to conserve or , in the case of industrial consumers , to use alternative energy sources . however , gas cost risk has been mitigated in recent years through improvements in rate design that allow us to collect from our customers the gas cost portion of our bad debt expense on approximately 75 percent of our residential and commercial margins . as discussed above , on august 1 , 2012 , we completed the sale of substantially all of our natural gas distribution operations in missouri , illinois and iowa . on august 8 , 2012 we entered into a definitive agreement to sell our natural gas distribution operations in georgia . the results of these operations have been separately reported in the following tables and exclude general corporate overhead and interest expense that would normally be allocated to these operations . review of financial and operating results financial and operational highlights for our natural gas distribution segment for the fiscal years ended september 30 , 2012 , 2011 and 2010 are presented below . replace_table_token_17_th 35 fiscal year ended september 30 , 2012 compared with fiscal year ended september 30 , 2011 the $ 4.8 million increase in natural gas distribution gross profit was primarily due to a $ 17.7 million net increase in rate adjustments , primarily in the mid-tex , louisiana , mississippi , west texas and kentucky service areas . these increases were partially offset by the following :  $ 11.1 million decrease in revenue-related taxes in our mid-tex , west texas and mississippi service areas , primarily due to lower revenues on which the tax is calculated .  $ 1.6 million decrease due to an eight percent decrease in consolidated throughput caused principally by lower residential and commercial consumption combined with warmer weather in the current year compared to last year in most of our service areas . operating expenses , which include operation and maintenance expense , provision for doubtful accounts , depreciation and amortization expense and taxes , other than income increased $ 22.4 million primarily due to the following :  $ 11.2 million increase in legal costs , primarily due to settlements .  $ 10.6 million increase in employee-related costs .  $ 8.4 million increase in depreciation and amortization associated with an increase in our net plant as a result of our capital investments in the prior year .  $ 2.6 million increase in software maintenance costs . these increases were partially offset by the following :  $ 6.8 million decrease in operating expenses due to increased capital spending and warmer weather allowing us time to complete more capital work than in the prior year .  $ 2.9 million decrease due to the establishment of regulatory assets for pension and postretirement costs . miscellaneous income decreased $ 28.9 million primarily due to the absence of a $ 21.8 million pre-tax gain recognized in the prior year as a result of unwinding two treasury locks ( $ 13.6 million , net of tax ) and a $ 10.0 million one-time donation to a donor advised fund in the current year . interest charges decreased $ 5.1 million compared to the prior year due primarily to the prepayment of our 5.125 % $ 250 million senior notes in the fourth quarter of fiscal 2012 , refinancing long-term debt at reduced interest rates and reducing commitment fees from decreasing the number of credit facilities and extending the length of their terms in fiscal 2011. additionally , results for fiscal 2012 were favorably impacted by a state tax benefit of $ 11.3 million . due to the completion of the sale of our missouri , iowa and illinois service areas in the fiscal fourth quarter , the company updated its analysis of the tax rate at which deferred taxes would reverse in the future to reflect the sale of these service areas . the

cash flows from financing activities for the fiscal year ended september 30 , 2012 , our financing activities used $ 44.8 million in cash , while financing activities for the fiscal year ended september 30 , 2011 generated $ 44.0 million in cash compared with cash of $ 163.0 million used for the fiscal year ended september 30 , 2010. our significant financing activities for the fiscal years ended september 30 , 2012 , 2011 and 2010 are summarized as follows : 2012 during the fiscal year ended september 30 , 2012 , we :  paid $ 257.0 million for long-term debt repayments , including the early redemption of our $ 250 million 5.125 % senior notes that were scheduled to mature in january 2013 . 44  borrowed $ 260 million under a short-term loan to finance the repayment of our $ 250 million 5.125 % senior notes .  borrowed a net $ 94.1 million under our short-term facilities , excluding the $ 260 million short-term loan used to finance the early redemption of our $ 250 million 5.125 % senior notes , to fund working capital needs .  paid $ 125.8 million in cash dividends , which reflected a payout ratio of 58 percent of net income .  paid $ 12.5 million for the repurchase of common stock as part of our share buyback program .  paid $ 5.2 million for the repurchase of equity awards . 2011 during the fiscal year ended september 30 , 2011 , we :  received $ 394.5 million net cash proceeds in june 2011 related to the issuance of $ 400 million 5.50 % senior notes due 2041 .  borrowed a net $ 83.3 million under our short-term facilities to fund working capital needs .  received $ 27.8 million cash in march 2011 related to the unwinding of two treasury locks .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```cash flows from financing activities for the fiscal year ended september 30 , 2012 , our financing activities used $ 44.8 million in cash , while financing activities for the fiscal year ended september 30 , 2011 generated $ 44.0 million in cash compared with cash of $ 163.0 million used for the fiscal year ended september 30 , 2010. our significant financing activities for the fiscal years ended september 30 , 2012 , 2011 and 2010 are summarized as follows : 2012 during the fiscal year ended september 30 , 2012 , we :  paid $ 257.0 million for long-term debt repayments , including the early redemption of our $ 250 million 5.125 % senior notes that were scheduled to mature in january 2013 . 44  borrowed $ 260 million under a short-term loan to finance the repayment of our $ 250 million 5.125 % senior notes .  borrowed a net $ 94.1 million under our short-term facilities , excluding the $ 260 million short-term loan used to finance the early redemption of our $ 250 million 5.125 % senior notes , to fund working capital needs .  paid $ 125.8 million in cash dividends , which reflected a payout ratio of 58 percent of net income .  paid $ 12.5 million for the repurchase of common stock as part of our share buyback program .  paid $ 5.2 million for the repurchase of equity awards . 2011 during the fiscal year ended september 30 , 2011 , we :  received $ 394.5 million net cash proceeds in june 2011 related to the issuance of $ 400 million 5.50 % senior notes due 2041 .  borrowed a net $ 83.3 million under our short-term facilities to fund working capital needs .  received $ 27.8 million cash in march 2011 related to the unwinding of two treasury locks .
```    
 Suspicious Activity Report : further , we undertake no obligation to update or revise any of our forward-looking statements whether as a result of new information , future events or otherwise . critical accounting policies our consolidated financial statements were prepared in accordance with accounting principles generally accepted in the united states . preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets , liabilities , revenues and expenses and the related disclosures of contingent assets and liabilities . we base our estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances . actual results may differ from estimates . 28 our significant accounting policies are discussed in note 2 to our consolidated financial statements . the accounting policies discussed below are both important to the presentation of our financial condition and results of operations and require management to make difficult , subjective or complex accounting estimates . accordingly , these critical accounting policies are reviewed periodically by the audit committee of the board of directors . regulation  our natural gas distribution and regulated transmission and storage operations are subject to regulation with respect to rates , service , maintenance of accounting records and various other matters by the respective regulatory authorities in the states in which we operate . we meet the criteria established within accounting principles generally accepted in the united states of a cost-based , rate-regulated entity , which requires us to reflect the financial effects of the ratemaking and accounting practices and policies of the various regulatory commissions in our financial statements in accordance with applicable authoritative accounting standards . we apply the provisions of this standard to our regulated operations and record regulatory assets for costs that have been deferred for which future recovery through customer rates is considered probable and regulatory liabilities when it is probable that revenues will be reduced for amounts that will be credited to customers through the ratemaking process . as a result , certain costs that would normally be expensed under accounting principles generally accepted in the united states are permitted to be capitalized or deferred on the balance sheet because it is probable they can be recovered through rates . discontinuing the application of this method of accounting for regulatory assets and liabilities could significantly increase our operating expenses as fewer costs would likely be capitalized or deferred on the balance sheet , which could reduce our net income . further , regulation may impact the period in which revenues or expenses are recognized . the amounts to be recovered or recognized are based upon historical experience and our understanding of the regulations . the impact of regulation on our regulated operations may be affected by decisions of the regulatory authorities or the issuance of new regulations . unbilled revenue  sales of natural gas to our natural gas distribution customers are billed on a monthly basis ; however , the billing cycle periods for certain classes of customers do not necessarily coincide with accounting periods used for financial reporting purposes . we follow the revenue accrual method of accounting for natural gas distribution segment revenues whereby revenues applicable to gas delivered to customers , but not yet billed under the cycle billing method , are estimated and accrued and the related costs are charged to expense . on occasion , we are permitted to implement new rates that have not been formally approved by our regulatory authorities , which are subject to refund . we recognize this revenue and establish a reserve for amounts that could be refunded based on our experience for the jurisdiction in which the rates were implemented . financial instruments and hedging activities  we use financial instruments to mitigate commodity price risk and interest rate risk . the objectives for using financial instruments have been tailored to meet the needs of our regulated and nonregulated businesses . these objectives are more fully described in note 4 to the consolidated financial statements . we record all of our financial instruments on the balance sheet at fair value as required by accounting principles generally accepted in the united states , with changes in fair value ultimately recorded in the income statement . market value changes result in a change in the fair value of these financial instruments . the recognition of the changes in fair value of these financial instruments are recorded in the income statement is contingent upon whether the financial instrument has been designated and qualifies as a part of a hedging relationship or if regulatory rulings require a different accounting treatment . we have elected to treat forward gas supply contracts used in our regulated operations to deliver gas as normal purchases and normal sales . financial instruments used to manage commodity price risk in our natural gas distribution segment do not impact this segment 's results of operations as the realized gains and losses are ultimately recovered from ratepayers through our rates . our nonregulated segment also utilizes financial instruments to manage commodity price risk . we have designated the natural gas inventory held by this operating segment as the hedged item in a fair-value hedge . the financial instruments associated with this natural gas inventory have been designated as fair-value hedges . changes in the fair value of the inventory and designated hedges are recognized in purchased gas cost in the period of change . 29 additionally , we have elected to treat fixed-price forward contracts used in our nonregulated segment to deliver gas as normal purchases and normal sales . financial instruments used to mitigate the commodity price risk associated with these contracts have been designated as cash flow hedges of anticipated purchases and sales at indexed prices . story_separator_special_tag our ability to earn our authorized rates is based primarily on our ability to improve the rate design in our various ratemaking jurisdictions by reducing or eliminating regulatory lag and , ultimately , separating the recovery of our approved margins from customer usage patterns . improving rate design is a long-term process and is further complicated by the fact that we operate in multiple rate jurisdictions . the ratemaking activity section of this form 10-k describes our current rate strategy , progress towards implementing that strategy and recent ratemaking initiatives in more detail . we are generally able to pass the cost of gas through to our customers without markup under purchased gas cost adjustment mechanisms ; therefore the cost of gas typically does not have an impact on our gross profit as increases in the cost of gas are offset by a corresponding increase in revenues . accordingly , we believe gross profit is a better indicator of our financial performance than revenues . however , gross profit in our texas and mississippi service areas include franchise fees and gross receipts taxes , which are calculated as a percentage of revenue ( inclusive of gas costs ) . therefore , the amount of these taxes included in revenues is influenced by the 34 cost of gas and the level of gas sales volumes . we record the tax expense as a component of taxes , other than income . although changes in revenue-related taxes arising from changes in gas costs affect gross profit , over time the impact is offset within operating income . as discussed above , the cost of gas typically does not have a direct impact on our gross profit . however , higher gas costs may adversely impact our accounts receivable collections , resulting in higher bad debt expense , and may require us to increase borrowings under our credit facilities resulting in higher interest expense . in addition , higher gas costs , as well as competitive factors in the industry and general economic conditions may cause customers to conserve or , in the case of industrial consumers , to use alternative energy sources . however , gas cost risk has been mitigated in recent years through improvements in rate design that allow us to collect from our customers the gas cost portion of our bad debt expense on approximately 75 percent of our residential and commercial margins . as discussed above , on august 1 , 2012 , we completed the sale of substantially all of our natural gas distribution operations in missouri , illinois and iowa . on august 8 , 2012 we entered into a definitive agreement to sell our natural gas distribution operations in georgia . the results of these operations have been separately reported in the following tables and exclude general corporate overhead and interest expense that would normally be allocated to these operations . review of financial and operating results financial and operational highlights for our natural gas distribution segment for the fiscal years ended september 30 , 2012 , 2011 and 2010 are presented below . replace_table_token_17_th 35 fiscal year ended september 30 , 2012 compared with fiscal year ended september 30 , 2011 the $ 4.8 million increase in natural gas distribution gross profit was primarily due to a $ 17.7 million net increase in rate adjustments , primarily in the mid-tex , louisiana , mississippi , west texas and kentucky service areas . these increases were partially offset by the following :  $ 11.1 million decrease in revenue-related taxes in our mid-tex , west texas and mississippi service areas , primarily due to lower revenues on which the tax is calculated .  $ 1.6 million decrease due to an eight percent decrease in consolidated throughput caused principally by lower residential and commercial consumption combined with warmer weather in the current year compared to last year in most of our service areas . operating expenses , which include operation and maintenance expense , provision for doubtful accounts , depreciation and amortization expense and taxes , other than income increased $ 22.4 million primarily due to the following :  $ 11.2 million increase in legal costs , primarily due to settlements .  $ 10.6 million increase in employee-related costs .  $ 8.4 million increase in depreciation and amortization associated with an increase in our net plant as a result of our capital investments in the prior year .  $ 2.6 million increase in software maintenance costs . these increases were partially offset by the following :  $ 6.8 million decrease in operating expenses due to increased capital spending and warmer weather allowing us time to complete more capital work than in the prior year .  $ 2.9 million decrease due to the establishment of regulatory assets for pension and postretirement costs . miscellaneous income decreased $ 28.9 million primarily due to the absence of a $ 21.8 million pre-tax gain recognized in the prior year as a result of unwinding two treasury locks ( $ 13.6 million , net of tax ) and a $ 10.0 million one-time donation to a donor advised fund in the current year . interest charges decreased $ 5.1 million compared to the prior year due primarily to the prepayment of our 5.125 % $ 250 million senior notes in the fourth quarter of fiscal 2012 , refinancing long-term debt at reduced interest rates and reducing commitment fees from decreasing the number of credit facilities and extending the length of their terms in fiscal 2011. additionally , results for fiscal 2012 were favorably impacted by a state tax benefit of $ 11.3 million . due to the completion of the sale of our missouri , iowa and illinois service areas in the fiscal fourth quarter , the company updated its analysis of the tax rate at which deferred taxes would reverse in the future to reflect the sale of these service areas . the

