2.2.0.7 false Goodwill Assets 0212 - Disclosure - Goodwill Assets true false false false 1 USD false false USD Standard http://www.xbrl.org/2003/iso4217 USD iso4217 0 USDEPS Divide http://www.xbrl.org/2003/iso4217 USD iso4217 http://www.xbrl.org/2003/instance shares xbrli 0 Shares Standard http://www.xbrl.org/2003/instance shares xbrli 0 $ 2 Goodwill Assets [Abstract] 0 ni_GoodwillAssetsAbstract ni false na duration Goodwill Assets. false false false false false true false false false false false false 1 false false false false 0 0 false false false xbrli:stringItemType string Goodwill Assets. false 3 Goodwill Assets 1 us-gaap_ScheduleOfGoodwillTextBlock us-gaap true na duration No definition available. false false false false false false false false false false false verboselabel false 1 false false false false 0 0   <div style="font-family: 'Times New Roman',Times,serif"> <div align="justify" style="font-size: 10pt; margin-top: 12pt"><b>12.</b>          <b>Goodwill Assets</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">In accordance with the provisions for goodwill accounting as issued by the FASB, NiSource tests its goodwill for impairment annually as of June 30 each year unless indicators, events, or circumstances would require an immediate review. Goodwill is tested for impairment at a level of reporting referred to as a reporting unit, which generally is an operating segment or a component of an operating segment as defined by the FASB. In accordance with the provision, certain components of an operating segment with similar economic characteristics are aggregated and deemed a single reporting unit. Goodwill is generally allocated to the reporting units based upon the amounts allocated at the time of their respective acquisition. The goodwill impairment test is a two-step process which requires NiSource to make estimates regarding the fair value of the reporting unit. The first step of the goodwill impairment test, used to identify potential impairment, compares the fair value of the reporting unit with its carrying value, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired, thus the second step of the impairment test is not required. However, if the carrying amount of the reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss (if any), which compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of reporting unit goodwill exceeds the implied fair value, an impairment loss is recognized in an amount equal to that excess. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">NiSource has four reporting units that carry or are allocated goodwill. NiSource’s goodwill assets at June 30, 2010 were $3.7 billion pertaining primarily to the acquisition of Columbia on November 1, 2000. Of this amount, approximately $2.0 billion is allocated to Columbia Transmission Operations (which is comprised of Columbia Transmission and Columbia Gulf) and $1.7 billion is allocated to Columbia Distribution Operations (which is comprised of Columbia of Kentucky, Columbia of Maryland, Columbia of Ohio, Columbia of Pennsylvania and Columbia of Virginia). In addition, the goodwill balances at June 30, 2010 for Northern Indiana Fuel and Light and Kokomo Gas were $13.3 million and $5.5 million, respectively. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">In estimating the fair value of the Columbia Transmission Operations and Columbia Distribution Operations reporting units for the June 30, 2010 test, NiSource used a weighted average of the income and market approaches. The income approach utilized a discounted cash flow model. This model is based on management’s short-term and long-term forecast of operating performance for each reporting unit. The two main assumptions used in the models are the growth rates, which are based on the cash flow from operations for each of the reporting units, and the weighted average cost of capital, or discount rate. The starting point for each reporting unit’s cash flow from operations is the detailed five year plan, which takes into consideration a variety of factors such as the current economic environment, industry trends, and specific operating goals set by management. The discount rates are based on trends in overall market as well as industry specific variables and include components such as the risk-free rate, cost of debt, and company volatility at June 30, 2010. Under the market approach, NiSource utilized three market-based models to estimate the fair value of the reporting units: (i) the comparable company multiples method, which estimated fair value of each reporting unit by analyzing EBITDA multiples of a peer group of publicly traded companies and applying that multiple to the reporting unit’s EBITDA, (ii) the comparable transactions method, which valued the reporting unit based on observed EBITDA multiples from completed transactions of peer companies and applying that multiple to the reporting unit’s EBITDA, and (iii) the market capitalization method, which used the NiSource share price and allocated NiSource’s total market capitalization among both the goodwill and non-goodwill reporting units based on the relative EBITDA, revenues, and operating income of each reporting unit. Each of the three market approaches were calculated with the assistance of a third party valuation firm, using multiples and assumptions inherent in today’s market. The degree of judgment involved and reliability of inputs into each model were considered in weighting the various approaches. The resulting estimate of fair value of the reporting units, using the weighted average of the income and market approaches, exceeded their carrying values, indicating that no impairment exists under Step 1 of the annual impairment test. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">Certain key assumptions used in determining the fair values of the reporting units included planned operating results, discount rates and the long-term outlook for growth. NiSource used discount rates of 4.76% and 4.74% for Columbia Transmission Operations and Columbia Distribution Operations, respectively. Management also performed a sensitivity analysis using discount rates of 5.78% and 5.76% for Columbia Transmission Operations and Columbia Distribution Operations, respectively. Using the discount rates of 4.76% and 4.74% for Columbia Transmission Operations and Columbia Distribution Operations, respectively, the excess fair values were approximately $2.6 billion and $4.2 billion, respectively. If the discount rates were increased to 5.78% and 5.76% for Columbia Transmission Operations and Columbia Distribution Operations, respectively, the excess fair value of the reporting units would be approximately $1.2 billion and $1.2 billion, respectively. Under either discount rate scenario, the impairment test indicated that each of the reporting units passed step one of the impairment test. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">Goodwill related to the acquisition of Northern Indiana Fuel and Light and Kokomo Gas of $13.3 million and $5.5 million, respectively, was also tested for impairment as of June 30, 2010 using an income approach to determine the fair value of each of these reporting units. A discount rate range of 4.74% to 5.76% and growth rates factoring in the regulatory environment and growth initiatives for each reporting unit were the significant assumptions used in determining the fair values using the income approach. The step 1 goodwill impairment test resulted in the fair value of each of these reporting units exceeding the carrying value. </div> </div>  <!-- Begin Block Tagged Note false false false us-types:textBlockItemType textblock The carrying amount of goodwill, goodwill acquired during the year, goodwill impairment losses recognized, goodwill written off due to the sale of a business unit, goodwill not yet allocated, and any other changes to goodwill during the period in total and for each reportable segment. At least annually, an Entity must evaluate its goodwill for impairment. 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