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The data compression technique of Signature Analysis (SA) is being used in an ever-increasing variety of test instruments, but in all cases the signature is used only as a pass/fail indication. It is possible, however, to obtain a limited amount of diagnostic information from a fault signature. In particular it is possible to determine the position of a single erroneous bit in a data stream, something which may prove to be of use in the testing of memories. The probability of the technique yielding incorrect results is investigated.