When using XML utf-8 the code is functioning but not utf-16

Question

Hello all,
I developed a GUI which imports data from XML file and then makes changes to it throught the GUI. The problem Im facing here is that when I first tested it in my laptop with XP sp-3 it was working fine in utf-16.
Now when im testing the GUI in my final system which uses XP embedded im not able to write back to the XML file using utf-16. But when I changed that to utf-8 it is working absolutely fine. The error I got when I was using utf-16 in XP Embedded is "There  is no Unicode byte order mark. Cannot switch to unicode". To correct this I changed the thing to utf-8.
Can you people tell me what the problem could be as it is working fine in XP SP-3 and not in XP Embedded.