Abstract: An instrument system provides compensation for signal processing errors by processing both sensor signals and reference signals in a common signal processor. Reference signals may be provided which enable zero compensation, gain compensation, or both. The system outputs compensated signals to a two wire signal loop in either analog or digital form, and selects the form of output signal in accordance with digital input signals received from the signal wires. The system may be embodied as a radio frequency admittance instrument system for monitoring the condition of materials.