??? why didn't this need a [1] near end to get first occurance ??? 
you would in xslt2 (or get an error if you passed two nodes to
generate-id) but in xslt 1 (or xslt2 in bbackwards compat mode)
string functions have a "first node" behaviour, they silently discard
all but the first node passed to them, so generate-id(foo) is the same
as generate-id((foo)[1]) in xslt 1.
In xslt2 though you wouldn't do this at all, you'd use for-each-group.
  <xsl:variable name="findings" select=key('audits', @AuditName)/>
not well formed.
### above line does not work, was meant to go with  above. ###
in what way doesn't it work? It works for me 9as in produces te output
you say you want)
### this states what I am trying to do, but I know syntax is wrong ###
actually not, without the line above (which uses correct syntax) I
probably wouldn't have guessed what was intended here.
### cannot select on the 2D list returned by key ###
Not sure what you mean here.
If I make your xsl well formed and change the 'InReview' test to use the
syntax you used for  'ActionPlan' I get 
something that appears to match
Audit  # Rows  ActionPlan  InReview ..........
CashboxII 2      1           1
SPN       2      2           0
<xsl:stylesheet version="1.0" xmlns:xsl="http://www.w3.org/1999/XSL/Transform">
 
<xsl:output method="html"/>
<xsl:key name="audits" match="Row" use="@AuditName" />
<xsl:template match="/dsQueryResponse/Rows">
  <table>
    <tr><th>AUDIT</th><th># Rows</th>
        <th># ActionPlan</th><th># InReview</th>
        <th># FollowUp</th><th># Closed</th>
    </tr>
    <xsl:apply-templates
      select="*[(_at_)AuditName and
                generate-id(.)=generate-id(key('audits', @AuditName))]" />
  </table>
</xsl:template>
<xsl:template match="*[(_at_)AuditName]">
  <xsl:variable name="findings" select="key('audits', @AuditName)"/>
  <tr>
    <td><xsl:value-of select="@AuditName" /></td>
    <td><xsl:value-of select="count(key('audits', @AuditName))" /></td>
    <td><xsl:value-of select="count($findings[(_at_)State='ActionPlan'])" 
/></td>
    <td><xsl:value-of select="count($findings[(_at_)State='InReview'])" /></td>
      </tr>
</xsl:template>
</xsl:stylesheet>
$ saxon ds.xml ds.xsl
<table>
   <tr>
      <th>AUDIT</th>
      <th># Rows</th>
      <th># ActionPlan</th>
      <th># InReview</th>
      <th># FollowUp</th>
      <th># Closed</th>
   </tr>
   <tr>
      <td>Cashbox II</td>
      <td>2</td>
      <td>1</td>
      <td>1</td>
   </tr>
   <tr>
      <td>SNP</td>
      <td>2</td>
      <td>2</td>
      <td>0</td>
   </tr>
</table>
David
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