Session tracking issues with IPs

From what I’ve read so far, piwik is supposed to be tracking visits by cookies and not by IPs, however I’m noticing that this doesn’t seem to be the case. I’m currently using Piwik version 1.5.0 and our audience is primarily people that are behind a NATed firewall. While looking at the visits I noticed that unique visits are fairly low, but the IPs that I know are the egress points have one massive visit each listed with thousands of actions.

Is there a setting that I’m missing to make it actually separate those out by the data from the session cookies and not by IP? This issue skews most of the aggregation of data, such as the custom variables, user settings, visitor log, etc.

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