State Audit Reprimands UConn for Spending $900,000 on Unused Software Licenses

uconnAccording to a recent state auditor’s report, the University of Connecticut paid over $900,000 in software licensing fees for a program that the school barely used in the three years they had the license.

The software in question, SciQuest, is a software-as-a-service, cloud-based computing service that, ironically, helps manage finances.

The university also signed a $10.1 million contract with SciQuest associate Kuali Financial System, but did not use a formal or well-documented selection process and didn’t run the decision by the university’s board of trustees, according to auditors.

There was so little documentation, in fact, that when auditors tried to find out if UConn had thoroughly explored other options aside from Kuali, they ran into a wall and had to give up. All documentation seemed to have been created after the software was selected, and it only explained what the chosen system would do for the community.

The Kuali Financial system software was deployed in July 2012 and seems to be working well, but UConn paid license fees for 3 years before they actually implemented the software. According to the report, “This software should not have been licensed before the university was ready to make use of it.”

According to UConn spokesman Tom Breen, SciQuest was expected to integrate directly into the university’s existing financial systems, but their old platform proved insufficient, resulting in the delay to put the software to use.

“Organizations can generally be broken into two groups – those who are paying too much for software because they’re over-licensed and those facing legal risks because they’re under-licensed,” says Bruce Liley, who manages a software licensing advisor company,Broomstick LLC. “It’s a pretty pervasive problem,” says Liley, “organizations may be able to save tens to hundreds of thousands of dollars depending on the size of the organization by understanding what software they are using and leveraging software procurement best-practices.”

State auditor John C. Geragosian told The Courant that the lack of selection process “raises a lot of flags: cost, favoritism…” and the report itself says it’s likely that “more advantageous alternatives may have been overlooked.”

Geragosian also pointed out that “They wasted $900,000 that could have gone to scholarships or whatever else.”

The ultimate recommendation from the auditors was for UConn to create a well-documented, formal selection process for any major acquisitions like the SciQuest license, to which UCon simply replied, “We agree.”

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