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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
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                                    FORM 10-K

            [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
                    For the fiscal year ended March 31, 1997

                                       OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
             For the transition period from __________ to __________

                         Commission file number 0-12734

                        STANFORD TELECOMMUNICATIONS, INC.
             (Exact name of registrant as specified in its charter)

         Delaware                                            94-2207636
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                               Identification No.)

                 1221 Crossman Avenue                              94089
                 Sunnyvale, California                         (Zip Code)
                 (Address of principal
                  executive offices)

               Registrant's telephone number, including area code:
                                 (408) 745-0818

           Securities registered pursuant to section 12(b) of the Act:
                                      None

           Securities registered pursuant to section 12(g) of the Act:
                                  Common Stock
                          Common Stock Purchase Rights
                                (Title of Class)

Indicate  by check  mark  whether  the  registrant:  (l) has filed  all  reports
required to be filed by section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                                    Yes   X          No
                                        ----           ----


<PAGE>


[ ] Indicate  by  check mark if disclosure of delinquent filers pursuant to Item
    405 of Regulation S-K is not contained herein, and will not be contained, to
    the best of  registrant's  knowledge,  in  definitive  proxy or  information
    statements  incorporated  by  reference in Part III of this Form 10-K or any
    amendments to this Form 10-K.

As of May  31,  1997,  the  aggregate  market  value  of  voting  stock  held by
non-affiliates of the registrant,  based on the closing sale price of such stock
on the Nasdaq National Market, was $170,523,827.  Shares of Common Stock held by
each officer, director and ten percent stockholder of the registrant, except for
Kopp Investment  Advisors,  Inc., have been excluded in that such persons may be
deemed  to  be  affiliates.  This  determination  of  affiliate  status  is  not
necessarily a conclusive determination for other purposes.

The number of shares of the  registrant's  Common Stock  outstanding  on May 31,
1997 was 12,845,286.

Documents Incorporated by Reference

Portions of the  registrant's  Annual Report to Stockholders for the fiscal year
ended March 31, 1997 (the "Annual Report to Stockholders"),  are incorporated by
reference in Parts II and IV of this Form 10-K. Portions of the definitive proxy
statement  for the Annual  Meeting of  Stockholders  to be held on June 25, 1997
(the "Proxy Statement"),  are incorporated by reference in Part III of this Form
10-K.


<PAGE>


                                     PART I

ITEM 1.  BUSINESS

         Stanford Telecommunications, Inc. ("Stanford Telecom" or the "Company")
designs,  manufactures, and markets advanced digital telecommunications products
and systems to establish or enhance  communications via satellites,  terrestrial
wireless and cable. The Company also provides  communication  systems networking
solutions and GPS navigation products.  Stanford Telecom's expertise encompasses
all the technologies  required for these systems including radio frequency (RF),
spread spectrum,  waveform, coding, modem, ASIC, software and system design. The
Company maintains a low cost commercial manufacturing capability and offers cost
effective engineering services.

         The Company's principal base business areas and products include:

          Advanced  Communications for Government Agencies 
          Transportable Milstar Terminal  
          Tri-band  Terminals   
          Communication   Satellite   Performance Monitoring  
          Air  Traffic  Control  Systems   Modernization   
          Commercial Telecommunications  Chip and Board Level Products  
          Satellite  Based Air Traffic Control System 
          Commercial Electronic Contract Manufacturing

         The Company was  incorporated in California in 1973 and  reincorporated
in  Delaware in 1988.  The  Company's  fiscal  year is composed of four  13-week
quarters,  each of  which  ends on the  Thursday  closest  to the  corresponding
calendar quarter end. Fiscal year 1997 ended on March 27, 1997.

BASE BUSINESS DISCUSSION

Advanced Communications for Government Agencies

         DSCS  Operational  Control  System  ("DOCS").  The  Company  developed,
installed and now assists in the operation of an extensive  network of computers
and software  which performs  control and  monitoring  functions for the Defense
Satellite  Communication System ("DSCS").  Control of the DSCS is complex due to
the different  types of multiple  access  techniques  used and the need to react
quickly to communications  requirements and to hostile jamming actions. The task
of  optimizing  and  controlling  the many  thousand of  parameters  in the DSCS
network  is  a  sophisticated  computational  problem  requiring  both  advanced
computers  and  extensive  information  processing.  The DOCS is  comprised of a
network  management and control  subsystems  that are used as tools for managing
DSCS ground station and space  communication  payload  assets.  The DSCS must be
operated and  maintained at peak  efficiency and maximum  availability  as it is
often the only means of communication  with deployed forces.  In September 1992,
the Company was awarded a DOCS  Support  Services  contract  with four  one-year
renewable options for an aggregate of $38 million for operations,  hardware, and
software  support.  The  Company  completed  the effort  under this  contract in
January  1997.  The DOCS3  contract was awarded to Stanford  Telecom in December
1996 by the U.S. Army Space Command.  With the award of this contract,  Stanford
Telecom will continue to provide  on-site  operations and  maintenance  support,
software support,  integrated  logistics  support,  training,  and depot support
services at twelve worldwide sites. The contract consists of a one-year base and
four one-year options,  with a total base value after exercise of all options of
approximately  $43.9.  Stanford  Telecom has been the incumbent  contractor  for
these  services  since  1981.  In addition to these  basic  support  tasks,  the
contract  includes  provisions  which would allow the Government to increase the
existing  scope  of  the  contract  by  adding  effort

                                      -1-
<PAGE>

associated  with  system  enhancements  and system  modifications,  which may be
required to extend the system's life expectancy.  Under a separate contract, the
Company is replacing existing Digital VAX equipment with newer minicomputers and
operating  systems.  The  upgraded  hardware  and  software is  currently  being
integrated at sixteen  facilities  worldwide in support of the DSCS  Operational
Control System.

         Replacement BATSON (RBATSON).  During fiscal year 1997, the Company was
awarded  the RBATSON  contract  with a total  value  including  options of $13.0
million.  The RBATSON provides protection for critical satellite  commanding and
data  transmission.   The  RBATSON  system  consists  of  a  Key  Generator/Data
Processing Assembly chassis, a Frequency  Generator/Radio Frequency Transmission
chassis,  and  Maintenance  Test  Equipment and provides the  capability for the
Satellite Configuration Control Element (SCCE) of the DOCS to interface with the
DSCS satellites. Deliveries will commence in fiscal 1999.

         Replacement  Satellite  Configuration  Control Element. The Company was
awarded a  contract  in  fiscal  year 1996  from the U.S.  Army to  provide  the
configuration  control  element in support  of network  management  for the U.S.
Government's  DSCS. The total value  including  options is  approximately  $21.7
million. Under this contract, the Company will provide the software and hardware
necessary to fully  configure,  test,  and deliver this element of the satellite
system.  The base  contract is  expected to be  completed  during  fiscal  1998.
Production  options are expected to extend the contract's  period of performance
through the year 2000 although there is no assurance  that the  Government  will
exercise their options to procure additional production hardware.

         Single Channel Transponder Injection Subsystem (SCTIS). The Company has
employed  its  spread  spectrum   technology  in  the  design,   production  and
installation of high performance  anti-jam uplink  transmission  systems for the
U.S.  Air Force which  protect  emergency  messages  being sent through the DSCS
against  jamming and  interception.  Since the program  commenced  in 1978,  the
Company has  delivered  twelve  SCTIS  systems  plus spare parts to the U.S. Air
Force.  During  fiscal  1996,  the Company was awarded a contract to upgrade the
system to replace  obsolete units and enhance  performance.  Development of this
upgrade is  currently  on-going.  The  Company is  currently  under  contract to
deliver an Enhanced Link Simulator in support of SCTIS.  Delivery of these units
is expected to be  completed  in fiscal  1998.  The Company is  currently  under
contract  to  deliver  twelve new  systems in support of SCTIS  along with spare
parts. Delivery of these units is expected to be completed in fiscal 1998.

         Tracking  and  Data  Relay  Satellite  Systems  (TDRSS).  The  National
Aeronautics and Space  Administration  (NASA) Tracking and Data Relay Satellites
enable NASA to maintain global continuous  communications with the space shuttle
and NASA satellites even when they are not in direct  line-of-sight  to tracking
stations in the continental  United States. The Company has been supporting NASA
on the TDRSS  Program  since  1977.  During  fiscal  year 1996,  the Company was
awarded a  follow-on  contract  consisting  of a one year base plus two one year
options with a total value  including  options of $21  million.  The Company has
several important roles in this billion dollar satellite system, including study
and system engineering  support, a major long-term  subcontract to support TDRSS
network  control,  prime  contracts to develop and assess  space/ground  segment
architectures  for  upgrading  the  TDRSS  system,  and  assisting  NASA  in the
deployment of a new TDRSS ground  terminal in Guam.  The Company has developed a
portable S-band, spread spectrum transmitter and companion receiver designed for
operation with TDRSS.  The Company  believes the market may be  significant  for
these products  although  revenues from these products have not been material to
date and there is no assurance that these products will gain market acceptance.

                                      -2-

<PAGE>


Transportable Milstar Terminal and Other Milstar Activities

         Milstar Satellite  Communications.  The Company has been involved since
1981 in development of the U.S.  Government's  Milstar satellite  communications
program,  designed to support  stationary and mobile users in the joint military
services in the 1990's and beyond. In addition to performing system  engineering
tasks,  the Company  has  developed  special  test  equipment  in support of the
Milstar program, including a subcontract for the Milstar EHF Test System to test
the Milstar  satellites in orbit.  Presently,  the Company is under  contract to
upgrade its Milstar Test Terminals to support the Medium Data Rate communication
capabilities being added to the Milstar Block II satellites.  During fiscal 1997
the  Company  invested  in its  development  activities  towards  a  proprietary
low-cost   transportable   Milstar  terminal.   The  Company  will  continue  to
demonstrate  this new  terminal to the  Milstar  communications  satellite  user
community.  The Company has recently been selected by Lockheed-Martin Missiles &
Space (Sunnyvale,  CA), prime contractor for the Milstar satellites,  to provide
three of these  transportable  Milstar  terminals  for use on  special  on-orbit
satellite test  operations.  The Company believes that there may be a market for
this product  although there is no assurance that the Company will realize sales
of its terminals or that the terminals will ever gain market acceptance.

         Joint In-Theater  Injection  Terminal (JITI).  During fiscal year 1996,
the Company  received a subcontract to build a  transportable  Ku-band SATCOM RF
prototype  system  for  use in the  military's  Global  Broadcast  Service.  The
subcontract  included  design,  integration,  and  production  of the first JITI
terminal for use by the U.S.  Army Space  Command.  The JITI provides a flexible
means of broadcasting  video,  audio, and data to Integrated  Receiver  Decoders
located within a theater of operations.  The system  throughput is approximately
24 Mbps,  which provides the means to broadcast  Unmanned  Aerial Vehicle video,
Cable News Network,  and programming  from the Armed Forces Radio and Television
Network.   The  prototype   unit  was   delivered,   and  was  used  to  provide
large-bandwidth  information sources in support of Operation Hope in Bosnia. The
Company  believes that this program will lead to other related Ku-band  terminal
programs,  however,  there is no  assurances  that the Company  will realize any
other sales.

Tri-band Terminals

         Defense Information Infrastructure Contingency Satellite Communications
Terminal  (DSAT).  During fiscal 1995, the Company  received a contract from the
Defense Information Systems Agency (DISA) for tri-band  transportable  satellite
terminals.  The DSAT  terminals  are  valued in excess of $1 million  each.  The
Company  commenced  delivery of the first units in January 1995. These satellite
terminals are self-contained trailer-mounted with tri-band capability and can be
configured for military, domestic and international satellites operating in C, X
or Ku bands.  The Company  delivered  seven DSAT systems through fiscal 1996 and
delivered  the final two in fiscal 1997.  The existing  contract  allows DISA to
exercise options for additional systems although their is no assurance that they
will do so.  The  Company  plans to  pursue  additional  transportable  tri-band
satellite terminal opportunities for various agencies of the U.S. Government.

Communication Satellite Performance Monitoring

         Communications  Signal  Monitoring.  In April  1993,  the  Company  was
awarded a $13 million multi-year  contract to provide a signal monitoring system
for the world's largest communications  satellite network, owned and operated by
Intelsat, an international consortium of over 100 nations. The contract required
the  development,  assembly,  installation  and test of  multiple  systems to be
deployed  world-wide.  During fiscal 1994 and 1995 the Company recognized losses
totaling $3.5 million  against the  completion of this  contract.  During fiscal
1996 the Company successfully delivered all systems required by the contract and
completed all necessary  installations and tests.  During early fiscal 1997, the
Company received final system  acceptance from Intelsat.  The Company  currently
has a maintenance  contract with Intelsat to

                                      -3-
<PAGE>

support the monitoring systems. In addition,  the Company offers its Transponder
Access  Control  System  (TACS)  to serve the needs of  customers  with  smaller
communication  satellite  networks.  Customers  including  the U.S.  Government,
Martin  Marietta,  Hughes,  Network Systems,  British Telecom,  GTE Spacenet and
Eutelsat have used TACS to monitor transponder  performance  including frequency
power,  bandwidth,  interference,  and  unauthorized  use  to  ensure  that  the
satellite is functioning efficiently.

Air Traffic Control System Modernization

         Since 1984,  the Company has been  supporting an FAA program to upgrade
and  modernize  the nation's air traffic  control and air  transport  navigation
system.  The Company's  activities  include air traffic control (ATC) automation
and  communications  system  engineering  and  support to FAA  special  projects
activities  such as the relocation of the Chicago O'Hare ATC Tower Complex.  The
Company is also  supporting the FAA in its  acquisition of the new terminal area
ATC  automation  system.  The above  activities  are being  conducted  under two
separate contracts:  one to GSA/FEDSIM for communication  system engineering and
one to DOT for transportation system engineering and R&D support.

Commercial Telecommunications Chip and Board Level Products

         Commercial  Telecommunications  Chip  and  Board  Level  Products.  The
Company designs,  manufactures and markets a wide range of Application  Specific
Integrated  Circuits  (ASIC)  and  board  level  assemblies  for  a  variety  of
commercial  telecommunication  applications.  These products provide the digital
signal  processing  required to transmit  and receive  information.  The Company
offers products for PSK (Phase Shift Key) modulation and  demodulation,  digital
down conversion,  the reception and transmission of spread spectrum information,
forward error  correction,  adaptive  equalization and direct digital  frequency
synthesis. Key market areas addressed by the Company include:

    - Cable/Internet   Communications.   Stanford   Telecom  has  developed  the
      modulation/  demodulation technology required for the "upstream" (from the
      subscriber  set-top box to the cable "headend")  transmission of data over
      hybrid fiber/coax (HFC) networks.  Products offered include the STEL-1109,
      a single-chip  complete BPSK/QPSK (Bi-Phase Shift  Key/Quadra-Phase  Shift
      Key) modulator ASIC,  specifically  designed for the  transmission of data
      from the subscriber to the headend and the STEL-9257,  a Burst Demodulator
      board level assembly that provides  demodulation  of burst QPSK signals in
      the upstream  environment.  The Company believes that a number of Internet
      access product manufactures have incorporated  Stanford Telecom's products
      into systems which are  currently in field trials at locations  throughout
      the United  States.  Although  revenues from these  products have not been
      material  to date,  the  Company  believes  that  future  revenues  may be
      significant if production orders are forthcoming.

    -  Very Small Aperture  Terminal  (VSAT)  Receiver  Assemblies.  The Company
       offers board level receiver assemblies for use in VSAT satellite systems.
       These digital demodulator assembly products are used for rural telephony,
       background music services and business data transmissions.  The STEL-9236
       product family and the recently  introduced  STEL-9258  Variable Bit Rate
       product  can  provide   signal  timing   recovery,   demodulation,   down
       conversion,  carrier  tracking and forward  error  correction  functions.
       Since  product   introduction,   the  Company  has  received  orders  for
       approximately 17,000 VSAT receiver assemblies.

    -  Catalog Products. The Company offers a wide range of ASIC and board level
       products providing various digital communications functions such as ASICs
       for spread  spectrum  wireless data links,  a family of ASICs for forward
       error  correction in  communication  links,

                                      -4-
<PAGE>

      and a series of  numerically  controlled  oscillators  and direct  digital
      synthesizers for precise signal generation and control.

Satellite Based Air Traffic Control System

         The Company was awarded a contract to support the FAA's  implementation
of a Global Positioning  System (GPS) Wide Area Augmentation  System (WAAS). The
contract  consists of a one-year  base and two  six-month  options  with a value
after  exercise of all options of $23 million.  The Company has been  supporting
the WAAS Program since 1990. The FAA's WAAS Program is a central  element of the
FAA's  plans to move  toward a satellite  based ATC  System.  The WAAS,  through
supplementing  the GPS  system,  will  enable this system to become a sole means
navigation source for en route and terminal area aviation  navigation  purposes.
This will greatly enhance  aircraft  navigation  capability and allow the FAA to
provide a more cost effective  navigation  infrastructure  for civil aviation in
the National  Airspace  System.  The Company has performed a central role in the
development  of  the  WAAS  concept  through  support  to  concept   definition,
prototyping  and field  testing.  This  contract  will  leverage  the  Company's
substantial  in-house  expertise in  satellite  navigation  to the  provision of
technical  support services  addressing  communications,  navigation,  hardware,
software  and test issues that  surround  development  of the WAAS.  The Company
believes that an international  need exist for WAAS capabilities and it plans to
pursue such opportunities as they arise.

         GPS  Instrumentation.  The Company provides standard  off-the-shelf GPS
navigation   instrumentation   products   and  GPS   simulators,   which   allow
laboratories,  system  integrators  and  manufactures of receivers to perform an
automated  test of GPS equipment by  simulating a wide range of vehicle  motions
including  aircraft flight, the motion of a ship or the route of a vehicle along
a road.  Automated  testing using GPS simulators  avoids time consuming  dynamic
testing on testbeds  such as aircraft and ships.  The Company  believes that the
market for this type of  specialized  product is  currently  limited  and future
revenues in this area are unlikely to be significant.

Commercial Electronic Contract Manufacturing

         During  fiscal  1993,  the  Company  began to pursue  opportunities  in
commercial  contract  manufacturing.  In addition to producing its own products,
the Company offers its contract  manufacturing services to commercial customers.
Revenues  for  the  Company's  contract   manufacturing   business  amounted  to
approximately  20% of total  revenues for fiscal 1996 and 1997, an increase from
approximately  10%  of  revenues  for  fiscal  1995.  The  Company's  Sunnyvale,
California  manufacturing  facilities  received  ISO-9001  certification  during
fiscal  1996.   During   fiscal  1997,   approximately   16%  of  the  Company's
manufacturing activities were associated with the Company's own products.

COMMERCIAL STRATEGIC PRODUCT DEVELOPMENT

         Stanford   Telecom  has   initiated  a  number  of  strategic   product
developments  and business  arrangements,  including those  addressed  below, to
address a growing  worldwide market for digital  telecommunication  products and
services.  Revenues from these  initiates have not been  significant to date and
there is no assurance  that the Company will be successful  in the  development,
marketing,  distribution  and  sales  of these  products;  however  the  Company
believes that the market for these product and services is substantial.

         Satellite  Personal  Communications.   In  recent  years  a  number  of
worldwide  satellite-based  cellular  systems  have  been  proposed,   including
TRW/Teleglobe's Odyssey, Inmarsat's ICO, Motorola's Iridium and Loral/Qualcomm's
Globalstar.  The Company has been carrying out research and  development  on the
medium  altitude  Odyssey  system being proposed by

                                      -5-

<PAGE>

TRW/Teleglobe.  The  Company  hopes  to play a key  role in the  ground  station
terminals that interface with the public switch telephone  network.  The Company
expects  Odyssey  to use a  Stanford  Telecom  proprietary  version of the OCDMA
(Orthogonal  Code Division  Multiple  Access)  waveform in transmission of voice
communications.  There has been no decision  on whether  Odyssey  will  proceed;
however a decision is expected this calendar  year. The Company is also a member
of a team  designing a high data rate  satellite  system for businesses and high
end consumers. The Company hopes to expand its role on this program,  however, a
final decision has not been reached regarding the continuation of the program.

         Wireless  Broadband  Communications  (LMDS/MMDS).   Wireless  broadband
communications,   also  called  Local  Multipoint  Distribution  System  (LMDS),
Multichannel/Multipoint Distribution System (MMDS) or "wireless cable", is a new
technique for two-way  transmission of high speed digital data using terrestrial
microwave  links to homes and offices.  The MMDS Systems  operate at the 2.5 GHz
frequency  spectrum.   Stanford  Telecom  and  Hewlett  Packard  have  signed  a
memorandum of  understanding  to develop a complete  LMDS system.  These systems
operate in the 28-29 GHz microwave frequency spectrum.  The Company has begun to
conduct  MMDS/LMDS  technology  demonstrations  and  continued  to  develop  the
capabilities   of  its  system   throughout   fiscal  1997.   There  is  growing
international  interest  in this  technology,  however,  it is  unlikely  that a
sizable  domestic  market will  develop for the LMDS system  until after the FCC
completes the auction for  utilization of the frequency  spectrum and the system
has been  adequately  field  demonstrated  to potential  customers.  The Company
believes  that the potential  for  significant  bookings may be realized in late
fiscal 1998.

         Cable/Internet Communications.  One of the major new cable markets that
can be  addressed  by the CATV service  provider is that of  high-speed  two-way
Internet and  worldwide  Web access.  The full  potential of the Internet can be
realized when high-resolution images can be quickly transmitted to the user. The
use of cable for this  application  offers the potential to increase the rate of
transmission  by a factor of  approximately  1,000 over typical  telephone modem
access.  In order to realize  these  increased  transmission  speeds,  the cable
system needs to be augmented with both upstream and high speed downstream links.
Stanford  Telecom has  developed and  currently  offers for sale products  which
address both  upstream and  downstream  links.  The Company plans to develop and
offer next generation  products to provide  improved  performance at lower cost.
The Company  believes it is in a good  position  to receive  initial  production
orders during fiscal 1998.

OTHER BUSINESS

Manufacturing

         Stanford  Telecom's  products are generally  manufactured from standard
components, its proprietary ASICs and other components or subsystems produced to
the Company's  specifications.  Most of the Company's  current  products contain
microprocessors  for which  proprietary  software is designed  and tested by the
Company's  engineers.  The  Company  does not have a  semiconductor  foundry  or
fabrication  facility.  For the production of ASICs, the Company  contracts with
companies that have foundry capability  including Zilog,  American  Microsystems
Inc., Lucent Technologies, and LSI.

         In  many  cases  only  a  single   source  is  available  for  specific
components,  and thus there is a risk of delay in  delivering  finished  systems
within  contractual  schedules.  The Company  attempts to minimize  this risk by
securing  second  sources,  finding  alternate  technologies to perform the same
function and maintaining  adequate  inventories of single source components.  To
date the Company has  experienced  no material  adverse  impact due to component
unavailability,   product  returns  or  contract  renegotiations.  Many  of  the
Company's  products are covered by a 90-day to one-year warranty under which the
Company will repair or replace  defective  parts. To date,  warranty expense has
not been significant.

                                      -6-
<PAGE>


         Marketing and Customers.

         The Company  markets its  products and services to agencies of the U.S.
Government,  prime  contractors  to these  agencies and an increasing  number of
commercial customers. The Company's marketing is conducted by its management and
technical  staff,  and in the  case of its  commercial  business,  domestic  and
international sales  representatives are also utilized.  The Company's marketing
efforts for its  government  business  consist of  responding  to  requests  for
proposals  and  solicitations  for bids from U.S.  Government  agencies or prime
contractors  to  these  agencies  and  direct  marketing  of its  off-the-shelf,
standardized  products.  The Company  markets its ASICs and commercial  products
primarily  through  its  direct  sales  personnel   consisting  of  9  full-time
employees,  22 independent sales representative  locations covering the U.S. and
Canada and 26 other  independent  sales  representative  offices  covering other
international territories. The Company also places advertisements for commercial
products,  particularly  its ASIC products,  in a number of trade  magazines and
participates in trade shows and industry symposiums.

         During  fiscal  1997,  1996 and 1995  approximately  59%,  54% and 69%,
respectively,  of the Company's  revenues were  attributable  to contracts  with
numerous agencies of the U.S. Government.  No single contract accounted for more
than 10% of revenues  during  fiscal 1997,  1996 or 1995.  Some of the Company's
U.S.  Government  sales  are made  under  letter  contracts  in which  the final
contract price is agreed upon after work has begun. To date, the Company has had
a small amount of revenue  from  international  customers.  Such sales are often
subject to U.S. State Department approval and export license requirements.

         Competition.

         Competition  is intense among  providers of digital  telecommunications
equipment,   products  and  services.  In  the  Company's  government  business,
competitors include major defense contractors,  telecommunications equipment and
electronics  firms, and systems  integrators,  most of which have  significantly
greater financial,  marketing and operating  resources than the Company, as well
as broader product lines and technological capabilities.  As a result of reduced
defense spending by the U.S. and other governments,  competition has become more
intense in the  Company's  government  business.  Although no single  competitor
competes with the Company in all of its product  lines,  a number of competitors
such as Harris Corporation,  Loral-Space,  Lockheed-Martin, TRW, BDM, CSC, Texas
Instruments,  Hitachi,  and Rockwell  International  compete with the Company in
various market segments.  Certain of the Company's  customers have technological
capabilities  in the  Company's  product  areas and could  choose to develop and
manufacture certain products themselves rather than purchase from suppliers such
as the  Company.  As the Company  continues  to  transition  to more  commercial
business, it expects to face new and increasing  competition with respect to its
commercially  oriented products and services.  The Company believes that, in its
highly  specialized  technical  environment,  price,  performance,   reputation,
reliability,  on-time delivery and customer support are the primary  competitive
factors among companies having similar technical capabilities.

         Backlog and Bookings.

         Funded  backlog  includes:  (i) projects  and orders  covered by signed
contracts for which the government has specifically  allocated funding; and (ii)
purchase  orders from  commercial  customers.  The Company's  backlog is largely
attributable  to  agencies  of the  U.S.  Government.  In the  case  of  certain
long-term  contract  awards,  the U.S.  Government  typically  makes  the  funds
available  over the life of the  contract as opposed to the time of the contract
award.  In such cases the Company  reports as funded bookings only the amount of
the funds  specifically  allocated and the resultant  backlog as funded backlog.
The Company  does not include  unexercised  options in  backlog.  The  Company's
funded bookings for fiscal 1997 and 1996 were $168.5 million and $155.0 million,
respectively,  and the Company's  backlog at the end of fiscal 1997 and 1996 was

                                      -7-
<PAGE>
$83.9 million and $82.4  million,  respectively.  At March 31, 1997 backlog from
the Company's  government and commercial  businesses  were  approximately  $51.9
million  and $31.9  million,  respectively.  There is no  assurance  that funded
backlog  will be  completed  and  booked as  revenue.  The  Company's  contracts
typically contain contingency  provisions permitting termination by the customer
at any time.  Cancellation of pending  contracts or termination or reductions of
contracts  in  progress  may have a  material  adverse  effect on the  Company's
results of operations.

         Research and Development.

         The telecommunications industry is characterized by rapid technological
change,  requiring a continuous  effort to enhance existing products and develop
new products.  The Company believes that its continued  success depends in large
part on its  ability  to develop  new and  enhanced  digital  telecommunications
products.  The Company conducts extensive research,  development and engineering
activities  with the objective of  developing  products and systems that provide
for cost-effective,  high-quality satellite  communications and digital wireless
telecommunications.  Since its inception,  the Company has developed a number of
innovative and proprietary  digital  telecommunications  technologies  through a
combination  of customer  and  internally  funded  research and  development.  A
significant portion of these expenditures include bid and proposal  expenditures
which are largely the initial advanced  technology  development efforts directed
toward a specific  product or  technical  task for which the  Company  must show
technical  viability.  Company-funded  expenditures for research and development
including  bid and  proposal  activities  for fiscal 1997,  1996,  and 1995 were
approximately $11.9 million, $8.4 million and $7.7 million, respectively,  which
represented 7.1%, 5.8%, and 6.8% of total revenues, respectively.

         The Company's  revenues have  historically  been derived primarily from
performing  contract research and development and engaging in limited production
contracts with agencies of the U.S. Government and their prime contractors. As a
result,  a substantial  portion of the digital  telecommunications  research and
development  performed by the Company since its inception has been funded by its
customers  and  recorded as revenues by the  Company.  Accordingly,  the cost of
performing this  customer-funded  research and development is included in "Costs
of Revenues" in the Company's financial  statements.  The Company is continually
seeking to develop new  products  for  commercial  applications  to leverage its
leading digital  telecommunications  technologies  that have been funded through
many military and government research and development  contracts since the early
1970's.

         Employees.

         As of March  31,  1997,  the  Company  employed  951  full-time  and 16
part-time employees and 20 professional consultants. Of the full-time employees,
472  are in  technical  operations,  181  in  manufacturing  operations,  122 in
management,  90 professional  non technical,  and 86 in support  positions.  The
majority of the Company's  employees  are highly  skilled  technical  personnel.
Several are nationally known leaders in the field of digital telecommunications.
Over 560  employees  hold  advanced  degrees,  including  approximately  35 with
doctoral degrees. None of the employees are represented by a labor union and the
Company  has  never had a work  stoppage.  The  Company  believes  its  employee
relations to be excellent.  Due to the nature of the Company's business, a large
number of its technical  employees must obtain security clearances from the U.S.
Government,  which limits the  available  pool of eligible  candidates  for such
positions to those who can satisfy prerequisites for such clearances.

         Patents and Proprietary Rights.

         The success of the Company's  business depends in part upon its ability
to  protect  trade  secrets,  obtain or  license  patents  and  operate  without
infringing  on the rights of others.  Although the Company has obtained  patents
covering certain of its technologies,  it believes that the

                                      -8-
<PAGE>

ownership  of  patents  has  not  generally  been a  significant  factor  in its
government business and that its success depends primarily on innovative skills,
technical  competence,  and  the  marketing  and  managerial  abilities  of  its
personnel.  The Company relies on a combination  of trade  secrets,  copyrights,
patents,   nondisclosure  agreements  and  technical  measures  to  protect  its
proprietary  rights in its  products and  technology.  Such  protection  may not
preclude  competitors  from  developing  products with  features  similar to the
Company's products.  The Company believes that patents will play an increasingly
important  role in its  commercial  business  and  during the past two years the
Company has received or filed for  approximately 60 patents with the U.S. Patent
and  Trademark  Office.  The Company  expects it will  continue to  aggressively
pursue  additional  patents to protect its  intellectual  property.  The Company
requires  its  employees  to  execute   proprietary   rights  and  nondisclosure
agreements  and to maintain the  confidentiality  of the  Company's  proprietary
information.

         Government Regulation.

         The  Company's  operations  are subject to compliance  with  regulatory
requirements  of federal,  state and local  authorities,  including  regulations
concerning employment  obligations and affirmative action,  workplace safety and
protection of the environment.  In addition,  many of the Company's products and
proposed  products  are or will be  subject  to  various  regulations  including
regulations  promulgated by the Federal Communications  Commission,  the FAA and
the DoD. While compliance with applicable regulations has not adversely affected
the Company's operations in the past, there can be no assurance that the Company
will continue to be in compliance in the future or that these  regulations  will
not change.

         In  addition,   the  Company  must  comply  with  detailed   government
procurement  and  contracting  regulations  and with  U.S.  Government  security
regulations, including those necessary to maintain required facility clearances.
Certain  of  these  regulations  carry   substantial   penalty   provisions  for
nonperformance or  misrepresentation  in the course of negotiations.  Failure of
the Company to comply with its government  procurement,  contracting or security
obligations  could  result  in  penalties  or  suspension  of the  Company  from
government  contracting,  which  would  have a  material  adverse  effect on the
Company's results of operations.

         The  Company  is  required  to  maintain  a  U.S.  Government  facility
clearance at most of its locations. This clearance could be suspended or revoked
if the  Company  is  found  not to be in  compliance  with  applicable  security
regulations.  Any such  revocation  or  suspension  would  delay  the  Company's
delivery of its products to customers. Although the Company has adopted policies
designed to assure its compliance  with  applicable  regulations  and there have
been no suspensions or  revocations  of any of its  facilities,  there can be no
assurance  that the approved  status of the Company's  facilities  will continue
without interruption.

         Forward Looking and Cautionary Statements.

         In the interest of providing the Company's  shareholders  and potential
investors with certain Company information, including management's assessment of
the Company's future potential,  certain statements set forth herein (a) contain
or are based on  projections  of revenue,  income,  earnings per share and other
financial  items or (b)  relate  to  management's  future  plans,  expectations,
objectives or to the Company's future economic performance.  Such statements are
"forward-looking  statements"  within  the  meaning  of  Section  27A(i)  of the
Securities  Act of 1933,  as amended,  and in Section  21E(i) of the  Securities
Exchange Act of 1934, as amended.

         Although any forward-looking  statements  contained herein or otherwise
expressed  by or on  behalf  of the  Company  are to  the  knowledge  and in the
judgment of the  officers and  directors of the Company,  expected to prove true
and to come to pass,  management is not able to predict the future with absolute
certainty.   Accordingly,   shareholders  and  potential  investors  are  hereby
cautioned

                                      -9-
<PAGE>

that  certain  events or  circumstances  could  cause  actual  results to differ
materially  from those  projected or  predicted.  In  addition,  forward-looking
statements are based on management's  knowledge and judgment as of the date such
statements   are  made,   and  the  Company   does  not  intend  to  update  any
forward-looking statements to reflect events occurring or circumstances existing
thereafter.

         In particular,  the Company  believes that the following  factors could
impact  forward-looking  statements  made  herein or  in  other written  or oral
releases and by hindsight,  prove such  statements to be overly  optimistic  and
unachievable:

       1. Future  revenues  on  government  contracts,  including  contracts  in
progress,  are subject to reduction or cancellation  without prior notice at the
convenience  of the  U.S.  Government.  Budgetary  constraints  and  changes  in
spending  priorities in government  agencies such as the  Department of Defense,
NASA,  and the FAA have  resulted  in  sudden  program  changes,  reductions  or
cancellations in the past and such conditions may be expected to continue.

       2.  The  Company  has  in  the  past  accepted  fixed  price  development
commitments for both government and commercial  contracts.  Although the Company
attempts  to bid  fixed  price  development  contracts  at an  amount  above the
expected costs of development and production,  the Company has from time to time
experienced  significant  cost  overruns  which  cannot  be  recovered  from the
customer.  The Company may in the future experience material cost overruns which
could adversely affect operating results over the life of the program.

       3. The Company's  basic  strategy is to employ its technology in wireless
telecommunications and digital signal processing in the commercial  environment,
generally as components  or  subsystems in the product or service  offerings for
large  telecommunications  companies. The transition from a government contracts
focus to  commercial  development  will expose the  Company to certain  business
risks not previously  encountered.  Of greatest significance will be the success
of the  Company's  customers in marketing the products or services for which the
Company provides key technology components,  or subsystems. A successful product
development effort will not produce meaningful long-term revenues or profits for
the Company unless its customer obtains market  acceptance of its end product or
service.  Factors such as system price,  competitive pressures,  consumer demand
and the like will impact the  customer's  and the Company's  level of commercial
success.  In  addition,  even if a product or service  proves to be a commercial
success,  the Company will  experience the continued risk that the customer will
develop or obtain lower cost alternatives to the Company's products or technical
solutions.

       4.  The   Company's   Commercial   Manufacturing   Division   has   grown
significantly   since  being   established  in  1993.   The  Division   provides
manufacturing  services to  producers  of  electronics  and medical  products on
either an inventory  consignment  or turnkey basis.  The contract  manufacturing
business is subject to wide swings in demand,  is price  sensitive and extremely
competitive.  In addition,  to the extent inventory is purchased in anticipation
of  future  contracts,  the  failure  to  obtain  such  contracts  can lead to a
reduction in the value of such inventory. The Company's Commercial Manufacturing
Division  does not  generally  operate  with  long-term  contracts  and is often
required to bid each new job even for major customers.

       5.  Many  of the  components  incorporated  in the  Company's  commercial
products, including all semiconductor components, are purchased from third party
vendors. Certain key components are sole sourced. From time to time, the Company
may  experience   significant  delays  in  component  availability  which  could
adversely  impact its ability to make timely  deliveries to its customers.  Such
events  could cause  expected  revenues to be delayed and the  possible  loss of
future orders.

                                      -10-

<PAGE>


ITEM 2.  PROPERTIES

         The Company's  headquarters and principal engineering and manufacturing
facilities  are  currently  located in four  adjacent  buildings  in  Sunnyvale,
California  where it leases  approximately  172,000  square feet.  The Company's
Sunnyvale  facility  leases  will  expire in the year 2000.  The leases  contain
options for renewal  under terms and  conditions to be negotiated at the time of
expiration.  The  Company  also leases  approximately  84,000,  46,400,  30,900,
15,300,  11,300,  and 8,000  square  feet of office  space in Reston,  Virginia,
Colorado Springs, Colorado, Annapolis Junction, Maryland, Lowell, Massachusetts,
Seabrook, Maryland, and Tinton Falls, New Jersey,  respectively,  which space is
used primarily for the  performance of study,  system  engineering  and hardware
contracts.  The Reston facility leases expire in 1998 through 2001. The Colorado
Springs,  Annapolis Junction, Lowell, Seabrook and Tinton Falls leases expire in
2002, 2003, 2001, 1997 and 2002, respectively.  The Company believes its current
facilities are suitable and adequate for the Company's  operations over the next
fiscal year.

ITEM 3.  LEGAL PROCEEDINGS

         The Company is involved from time to time in  litigation  incidental to
its business.  Management  believes that the outcome of current  litigation will
not have a  material  adverse  effect on its  financial  position  or results of
operations.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Inapplicable.

CORPORATE OFFICERS OF THE COMPANY

         Set forth below are the names and ages of the executive officers of the
Company,  their  principal  occupations  at present and for the past five years,
certain directorships held by each, and the term of office with the Company.

Dr. James J. Spilker,  Jr. (age 63), a founder of the Company, has been Chairman
of the Board since 1983. He served as President and Chief  Executive  Officer of
the Company from August 1981 to June 1995. Since June 1995, Dr. Spilker also has
been serving as Principal Scientist for the Company.

Dr. Val P.  Peline  (age 66) was elected as a Director of the Company in October
1985. Dr. Peline joined the Company as its President and Chief Executive Officer
effective June 5, 1995. Dr. Peline served as President of the Electronic Systems
Group,  a division  of  Lockheed  Corp.,  from 1987  until he retired  from such
position in March 1995.  Dr.  Peline had been  President of the  Lockheed  Space
Division from 1984 to March 1987.

Mr. Leonard Schuchman (age 60) was elected as a Director of the Company in April
1985. Mr. Schuchman joined the Company in January 1976 and became Vice President
in February 1977. He is responsible  for directing the Company's  Communications
and Navigation Systems Operation.

Mr.  Ernest L. Dickens,  Jr. (age 50) joined the Company in October  1981.  From
April 1990 to October 1995 he directed the Company's Government Systems Services
operation. Mr. Dickens was elected Vice President in November 1995 and currently
directs the Company's Satcom Ground Systems operation.

                                      -11-

<PAGE>


Mr. Bronic C. Knarr (age 51) joined the Company in November 1988.  From November
1988 to April 1992 Mr. Knarr held various management positions at the Company in
support of key programs.  From April 1992 to September  1995 Mr. Knarr  directed
the Company's Satellite Communications  operations.  In September 1995 Mr. Knarr
was appointed  director of the  Company's  Manufacturing  and Quality  Assurance
operation and was elected Vice President in November 1995.

Dr.  John E.  Ohlson  (age 57) joined the  Company in March 1981 as  Director of
Telecommunications  Programs  Operations  and became Vice  President  in January
1982. In February 1991 he was named Director of Military Ground  Terminals.  Dr.
Ohlson  directed the Satellite  Communications  Group from June 1992 to November
1994. Dr. Ohlson was named as the Company's Chief Technical  Officer in November
1994 and  currently  directs the  Company's  Satellite  Personal  Communications
Operation.

Mr. Gary S. Wolf (age 46) joined the  Company in May 1978 and was  elected  Vice
President, Chief Financial Officer, Secretary and Treasurer in December 1984. In
January 1997 he was promoted to Executive Vice President.

Mr. Jerome F. Klajbor (age 41) joined the Company in February  1989. Mr. Klajbor
served as a Contracts  Manager for the Company  from 1989 to 1991.  From 1991 to
1996,  Mr.  Klajbor  served as  Director  and  subsequently  Vice  President  of
Administration and Finance for the Company's  Communication  Navigation Systems.
He was elected Vice President and Chief Financial Officer in January 1997.

                                     PART II

ITEM 5. - MARKET FOR THE  REGISTRANT'S  COMMON STOCK AND RELATED SECURITY HOLDER
MATTERS

Incorporated by reference from page 28 of the Annual Report to Stockholders.

ITEM 6.  SELECTED FINANCIAL DATA

Incorporated by reference from page 28 of the Annual Report to Stockholders.

ITEM 7. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Incorporated  by  reference  from pages 15  through  18 of the Annual  Report to
Stockholders.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

         Financial statements of Stanford  Telecommunications,  Inc. as of March
31, 1997 and March 31, 1996 and for each of the three years in the period  ended
March 31,  1997 and the report of  independent  public  accountants  thereon are
incorporated  by  reference  from pages 19  through  27 of the Annual  Report to
Stockholders. See Part IV, Item 14(a).

ITEM 9.  DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Inapplicable.

                                      -12-

<PAGE>


                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

         The   information   set  forth   under   the   caption   "Election   of
Directors-Information  with Respect to Nominees and Directors" beginning on page
2 of the Company's Proxy Statement is incorporated  herein by reference and made
a part hereof in response to the information required by this item. In addition,
certain information pertaining to executive officers of the Company is set forth
on pages 11-12 hereof.

ITEM 11.  EXECUTIVE COMPENSATION

         The  information set forth under the caption  "Executive  Compensation"
beginning on page 5 of the Company's Proxy  Statement is incorporated  herein by
reference and made a part hereof in response to the information required by this
item.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The information set forth under the caption "Stock Ownership" beginning
on page 12 of the Company's Proxy Statement is incorporated  herein by reference
and made a part hereof in response to the information required by this item.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Inapplicable.

                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a) The  following  report,  financial  statements  and  other  information  are
incorporated by reference from the Annual Report to stockholders and form a part
of this report:

                                                            Reference Page
                                                            --------------

                                                       1997
                                                      Annual
                                                      Report           Form 10-K
                                                     -------           ---------
1.       Financial Statements.

         Report of Independent Public
         Accountants                                    19

         Statements of income for each
         of the three years in the period
         ended March 31, 1997                           19

         Balance sheets at March 31, 1997 and
         March 31, 1996                                 20

         Statements of shareholders' equity for
         each of the three years in the period
         ended March 31, 1997                           21

                                      -13-

<PAGE>


                                                           Reference Page
                                                           --------------

                                                       1997
                                                      Annual
                                                      Report           Form 10-K
                                                     --------          ---------
         Statements of cash flow for each of
         the three years in the period ended
         March 31, 1997                                 22

         Notes to financial statements                  23

2.       Financial Statement Schedules

         Report of Independent Public Accountants on Schedules            18
         Schedule II - Valuation and Qualifying Accounts                  19

         All other schedules have been omitted since the required information is
not present or not present in amounts  sufficient  to require  submission of the
schedule or because  the  information  required  is  included  in the  financial
statements or notes thereto.

         With  the  exception  of  such  information  in the  Annual  Report  to
Stockholders incorporated herein by reference, the Annual Report to Stockholders
is not deemed "filed" as part of this report.

3.       Exhibits.

Exhibit Number                          Description
-------------                           ------------                   
3.1(2)      Certificate of Incorporation, as amended.

3.2(2)      Bylaws, as amended.

4.1(6)      Rights Agreement dated as of May 9, 1995 between the Company and The
            First National Bank of Boston.

4.2         Agreement re. Rights of Holders of Long-Term Debt.

10.1(5)     Consolidated,  Amended and  Restated  Deed of Lease for the premises
            located  at 1761  Business  Center  Drive,  Reston,  Virginia  dated
            October 1, 1993  between the Company and the  Variable  Annuity Life
            Insurance Company.

10.2(1)*    1982 Stock Option Plan, as amended, and form of Agreements.

10.3(3)*    1992 Employee Stock Purchase Plan.

10.4(4)     Lease  dated  November  19,  1992  for 480  Java  Drive,  Sunnyvale,
            California, 440 Moffett Park Drive, Sunnyvale,  California, and 1221
            Crossman Avenue, Sunnyvale, California.

10.5(5)     Office Lease Agreement for 141 National Business Parkway,  Annapolis
            Junction,  Maryland  dated  March 1, 1993  between  the  Company and
            Constellation Real Estate, Inc.

10.6*(8)    1991 Stock Option Plan and form of Agreements.

10.7*(8)    Management Incentive Plan.

10.8(8)     Credit  Agreement  dated  December  5, 1996 between the Company  and
            Bank of America National Trust and Savings  Association (the "Credit
            Agreement").

                                      -14-
<PAGE>

10.9        First Amendment to the "Credit Agreement" dated December 5, 1996.

13.1(7)     Annual  Report to  Stockholders  for the fiscal year ended March 31,
            1997.

23.1        Consent of Arthur Andersen LLP, independent public accountants.

24.1        Power of Attorney (included on the signature pages hereof).

27.1        Financial Data Schedule

---------------------------

*Compensatory Plan

(1)   Incorporated  by reference  from the Company's  Annual Report on Form l0-K
      for the fiscal year ended March 31, 1987.

(2)   Incorporated  by reference  from the Company's  Annual Report on Form l0-K
      for the fiscal year ended March 31, 1989.

(3)   Incorporated  by reference  from the Company's  Annual Report on Form l0-K
      for the fiscal year ended March 31, 1992.

(4)   Incorporated  by reference  from the Company's  Annual Report on Form l0-K
      for the fiscal year ended March 31, 1993.

(5)   Incorporated  by reference  from the Company's  Registration  Statement on
      Form S-1, No. 33-72720.

(6)   Incorporated  by reference  from the Company's  Registration  Statement on
      Form 8-A, dated May 24, 1995.

(7)   Only  those  portions  of the  Annual  Report  to  Stockholders  that  are
      specifically  incorporated  by reference in this form 10-K are included in
      this exhibit.

(8)   Incorporated by reference from the Company's Annual Report on Form 10K for
      the fiscal year ended March 31, 1996.

Reports of Form 8-K

No current Reports on Form 8-K were filed by the Company with the Securities and
Exchange  Commission  during the last quarter of the period covered by this Form
10-K.


                                   SIGNATURES

         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended,  the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

                                         STANFORD TELECOMMUNICATIONS, INC.


Dated: June 23, 1997                     /s/ James J. Spilker, Jr.              
                                         ---------------------------------------
                                             James J. Spilker, Jr.
                                             Chairman of the Board

                                      -15-
<PAGE>


POWER OF ATTORNEY

         KNOW ALL PERSONS BY THESE  PRESENTS,  that each person whose  signature
appears  below  constitutes  and appoints  James J.  Spilker,  Jr. and Jerome F.
Klajbor and both of them, as his true and lawful  attorneys-in-fact  and agents,
with full power of  substitution  and  resubstitution,  for him and in his name,
place and stead,  in any and all  capacities,  to sign any and all amendments to
this  Form  10-K and to file the  same,  with all  exhibits  thereto  and  other
documents in connection therewith,  with the Securities and Exchange Commission,
granting unto said  attorneys-in-fact  and agents,  and each of them, full power
and  authority  to do and  perform  each and every act and thing  requisite  and
necessary  to be done in  connection  therewith,  as  fully to all  intents  and
purposes as he might or could do in person,  hereby ratifying and confirming all
that said  attorneys-in-fact  and  agents,  or  either of them,  or their or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
this  report has been  signed  below by the  following  persons on behalf of the
registrant and in the capacities and on the dates indicated:

      Signature                      Title                              Date
      ---------                      -----                             -----


/s/ James J. Spilker, Jr.      Chairman of the Board               June 17, 1997
---------------------------
James J. Spilker, Jr.



/s/ Val P. Peline              President (Principal Executive      June 17, 1997
---------------------------    Officer) and Director
Val P. Peline                  




/s/ Jerome F. Klajbor          Vice President and Secretary,       June 19, 1997
---------------------------    (Principal Financial   
Jerome F. Klajbor              and Accounting Officer)
                               



/s/ Michael Berberian          Director                            June 18, 1997
---------------------------
Michael Berberian



/s/ John W. Brownie            Director                            June 18, 1997
-----------------------
John W. Brownie



/s/ P. Marshall Fitzgerald     Director                            June 19, 1997
--------------------------
P. Marshall Fitzgerald

                                      -16-
<PAGE>


/s/ Milton W. Holcombe         Director                            June 18, 1997
-----------------------
Milton W. Holcombe



/s/ Leonard Schuchman          Vice President and Director         June 18, 1997
-----------------------
Leonard Schuchman



/s/ C. J. Waylan               Director                            June 19, 1997
-----------------------
C. J. Waylan

                                      -17-

<PAGE>


                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
                                  ON SCHEDULES

To Stanford Telecommunications, Inc.:

We have audited in accordance with generally  accepted auditing  standards,  the
financial  statements  included in Stanford  Telecommunications,  Inc.'s  annual
report to  stockholders  incorporated  by reference in this Form l0-K,  and have
issued our  report  thereon  dated  April 22,  1997.  Our audit was made for the
purpose of forming an opinion on those statements taken as a whole. The schedule
listed at Item 14(a)(2) is the responsibility of the Company's management and is
presented  for  purposes  of  complying   with  the   Securities   and  Exchange
Commission's  rules  and is not part of the  basic  financial  statements.  This
schedule has been subjected to the auditing  procedures  applied in the audit of
the  basic  financial  statements  and,  in our  opinion,  fairly  states in all
material  respects  the  financial  data  required  to be set forth  therein  in
relation to the basic financial statements taken as a whole.





                                              ARTHUR ANDERSEN LLP

San Jose, California
April 22, 1997

                                      -18-

<PAGE>


                                   SCHEDULE II

                        STANFORD TELECOMMUNICATIONS, INC.
                        Valuation and Qualifying Accounts
                        Three years ended March 31, 1997
                                 (In Thousands)



Allowance for doubtful accounts


                  Bal. at Beg.     Charged to       Bad Debts      Bal. at End
         Year     of Period        Expense         Written Off      of Period
         ----     ---------        ----------      -----------     -----------

         1995       $243            $541            $(134)           $ 650
         1996       $650            $468            $(198)           $ 920
         1997       $920            $135            $ (32)          $1,023

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