Abstract: In one aspect of the invention, a stream is divided into two substreams, the first substream providing information relating to a ‘downmix’ signal obtained by matrixing and containing fewer channels than an original multichannel digital signal, and the second substream providing additional information allowing the original multichannel digital signal to be losslessly recovered by a decoder. In a preferred implementation, an encoder furnishes the downmix signal using a cascade of one or more primitive matrix quantizers, each of which implements an n-by-n matrix, followed by selection of the m channels required for the downnix. In a second aspect, a lossless compression system includes a dither seed in the encoded bitstream. The dither seed is used to synchronize a pseudo-random sequence generator in the decoder with a functionally identical generator in an encoder.