Thanks, David. I tried what you said put the $word="\xE1"; and give
  initial value for parameter in <xsl:param name="Kentry"
  select="'\xE1'"/>. And made the line like this:   <xsl:for-each
  select="/reportname/Entry[substring(ENTRY_FORM,1,$wordLength) =

No: In XML files you need to use XML conventtions so &xE1; 
in PHP files you need to use php conventions which (google tells me) are
\xE1 so in the XML quoted above you should use XML & notation, although
if you are passing in a parameter it doesn't matter what you put there
as the default value is not used.
What's $wordlength?

change 
<xsl:for-each
select="/reportname/Entry[substring(ENTRY_FORM,1,$wordLength) =
substring($Kentry,1,$wordLength)]">

to

<xsl:for-each
select="/reportname/Entry">

so that you get something and add

<xsl:message>
ENTRY_FORM=<xsl:value-of select="ENTRY_FORM"/>
$Kentry=<xsl:value-of select="$Kentry"/>
$wordLength=<xsl:value-of select="$wordLength"/>
</xsl:message>

to the for each loop so you see the values that you are testing.

David

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