Stitchmastery allows you to add colours to charts to be used for different functions - as guidance or highlighting, as well as representing different colours of yarn. To have yarn colours added to your instructions, and have your annotations for repeated stitches distinguish between different yarn colours (ie - indicating the number of repeated stitches in any given colour rather than just giving one indication for the number of repeated knit/purl/etc stitches, regardless of colour), select Diagram > Edit Diagram Properties from the main menu. Select the Written Instructions tab and check the box which says Include colours in written instruction and for repeated stitches.
Select a colour from your key (see Selection Tools).
In the main menu bar, click on Yarn > Edit Yarn Properties - the following dialog opens:
When you click OK and return to your chart editing screen, you will see the Output Text section automatically updates to include the alias of each yarn colour in the written instructions.