Yes because it´s in the nature of hdmi, however for most people it doesn´t work because they forget to plug in the spdif cable from the graphics card to the sound spdif controller on the motherboard, you should get one of those cables with your graphs card and instructions on where to connect it.
sorry your wrong in this case.
since the 4000 series ATI has had a built in audio encoder in the gpu's so it has its own sound and no external connection is required.
infact my 5870 will automatically change windows sound output to "ATI HDMI" or something like that when I use my HDTV via HDMI and then change it back to my X-FI card when I play on my Dell monitors via DVI/DP
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