NEW BRUNSWICK, NJ—Rutgers University recently blamed "glitches" for payment problems after updating their financial system, which shells out more than $700 million every year to over tens of thousands of vendors.
Staff were working overtime during the school's winter break to catch up on a backlog that amounted to more than 12,600 unpaid bills.
The financial glitches mainly affected third-party procurement services such as restaurants and guest speakers.
Some of these vendors were not paid for their services and utilities in certain buildings under the university’s jurisdiction were shut off due to a backlog of unpaid bills.
Reports of the glitches began spiking in October of 2016 when the university began making the switch to Cornerstone, a brand of financial accounting software.
According to NJ.com's Kelly Heyboer, Rutgers is paying a California-based company called Oracle $2.1 million annually to license the new program.
Another out-of-state software company, North Carolina-based SciQuest, is also getting a $706,581 annual licensing fee for the procurement software used in the new system, according to NJ.com.
The lead consultant on the Cornerstone project was reportedly UK-based Deloitte, one of the "Big Four" accounting firms.
According to Heyboer's January 16 article, Deloitte has billed Rutgers approximately $6.7 million over the last eighteen months to help oversee the rollout.
Rutgers Head of External Affairs Pete McDonough said the university has spent close to a year working through the financial system upgrade, according to an article in Philly.com.
Rutgers acquired the bulk of University of Medicine and Dentistry of New Jersey in 2013, which included the New Jersey Medical School, Robert Wood Johnson Medical School, the New Jersey Dental School, the School of Nursing, the School of Public Health, and the Cancer Institute of New Jersey.
The financial system upgrade was put in place to smooth out the integration of the previously mentioned schools.
“When you convert a system like that, there’s going to be some glitches,” he told the Philadelphia Inquirer.
Rutgers does, however, have an emergency payment process that rushes high priority invoices.
“People have been working overtime and created these backup systems to expedite things,” McDonough was quoted as saying in the December 28 article. “That backlog is being brought down to the point where it will be fully caught up in the not-too-distant future.”