A survey of the top organizations in Australia as ranked on the International Bank Information System was conducted to determine if executives gave any heed to theory on capital budgeting. Results show that there is considerable divergence between some of the theories developed in the university classroom and the practice in the real world. Some 76% of executives said that their firm accepted projects that failed to meet company benchmarks. The main reason for this was the inability to factor strategic considerations into the evaluation process. Some academics can be disparaging about the continued use of some "naive" techniques, but they may be reasonable for small projects. However, there is plenty of room for improvement in the capital budgeting procedures of most firms, particularly in valuing the strategic component of a project.