We live in an era of information where the growth and fate of organizations, individuals andrnothers is determined by the degree of their access to and control over information resources. Forrnthis reason, information technology has become a strategic and competitive weapon of therninformation age. Because of their awareness of its power and potentials, therefore, more andrnmore organizations are spending considerable amount of resources in IT projects.rnHowever, such expenditures many not yield the desired results unless they are evaluated in arnsystematic and formal way. To this end, a number of traditional and new methods have beenrndesigned to evaluate the viability of IT and non-IT projects and to help the concerned policyrnmakers arrive at the right investment decisions rnOf the available methods, the traditional financial techniques have been in use for a very longrnperiod of time but they are now being criticized for their inadequacy in evaluating [T projects.rnSome of the newly proposed methods seem to be practical while others look a bit theoretical andrnIncompleternIn spite of the availability of alternative evaluation methods, many organizations do not seem tornevaluate the viability of their IT investments properly.rnThe study addresses the foregoing issues and explores how IT projects are evaluated in thernEthiopian financial sector - the sector which is characterized by its information-intensivernactivity. It also provides a brief account of the results of the survey. The study indicates thernprevalence of less systematic, highly subjective, and informal evaluation practices. Lack ofrnskilled and experienced manpower in the area of IT evaluation is considered to be the mostrnserious problem in the sector.rnThe use of various techniques including the Payback Period, Net Present Value and InformationrnEconomics are recommended. There is a need for more emphasis on and coverage of ITrnevaluation in computing and information science training; for organization of workshops andrnshort-term training. Further research in this area is also recommended in order to improve thernoverall evaluation practice in the financial sector.