LETTER RE: CHANGE IN ACCOUNTING PRINCIPLES

KPMG Peat Marwick LLP

One Arizona Center Telephone 602 253 2000
400 E. Van Buren Street
Suite 1100
Phoenix, AZ 85004


August 4, 1997

Microchip Technology Incorporated
Chandler, Arizona

Ladies and Gentlemen:

We have been furnished with a copy of Form 10-Q of Microchip Technology
Incorporated (Microchip or Company) for the three months ended June 30, 1997,
and have read the Company's statements contained in Note 1 to the condensed
consolidated financial statements included therein. As stated in Note 1, the
Company changed its method of accounting for inventories from the last-in,
first-out (LIFO) method to the first-in, first-out (FIFO) method and states that
the newly adopted accounting principle is preferable in the circumstances
because the FIFO method is the predominant accounting method used in the
semiconductor industry. In accordance with your request, we have reviewed and
discussed with Company officials the circumstances and business judgment and
planning upon which the decision to make this change in the method of accounting
was based.

We have not audited any financial statements of Microchip Technology
Incorporated as of any date or for any period subsequent to March 31, 1997, nor
have we audited the information set forth in the aforementioned Note 1 to the
condensed consolidated financial statements; accordingly, we do not express an
opinion concerning the factual information contained therein.

With regard to the aforementioned accounting change, authoritative criteria have
not been established for evaluating the preferability of one acceptable method
of accounting over another acceptable method. However, for purposes of Microchip
Technology Incorporated's compliance with the requirements of the Securities and
Exchange Commission, we are furnishing this letter.

Based on our review and discussion, with reliance on management's business
judgment and planning, we concur that the newly adopted method of accounting is
preferable in the Company's circumstances.

Very truly yours,
/s/ KPMG Peat Marwick LLP