5.1 Surround Not Optional in Audio Midi Setup

Hi

I have a late 2012 21.5" iMac, running Catalina 10.15.5.

Here's the system info:

Model Name: iMac

  Model Identifier: iMac13,1

  Processor Name: Quad-Core Intel Core i5

  Processor Speed: 2.7 GHz

  Number of Processors: 1

  Total Number of Cores: 4

  L2 Cache (per Core): 256 KB

  L3 Cache: 6 MB

  Memory: 8 GB

  Boot ROM Version: 291.0.0.0.0

  SMC Version (system): 2.9f8

  Serial Number (system): C02L51CQDNCR

  Hardware UUID: C14A67AE-40DF-5DA4-B267-8B184F386D9D

And the audio info:

Built-in Microphone:

  Default Input Device: Yes

  Input Channels: 2

  Manufacturer: Apple Inc.

  Current SampleRate: 44100

  Transport: Built-in

  Input Source: Internal Microphone

Built-in Output:

  Default Output Device: Yes

  Default System Output Device: Yes

  Manufacturer: Apple Inc.

  Output Channels: 2

  Current SampleRate: 96000

  Transport: Built-in

  Output Source: Digital Out

I am using a mini TOSLINK to connect the audio out to a Panasonic SA-HT05 5.1 channel home theatre system (using Optical in on Opt1).

When I go into Audio Midi Setup and I can see it's using Digital Audio Output but when I try to "Configure Speakers" the dropdown "Configuration" option only shows "Stereo"; there is no option for "Surround".

It is playing Stereo sound from the Mac but when I used a test WAV in VLC with 4 channels, it only goes to Stereo.

The Mac support digital audio out, but does it not support more than 2 channels?

Thanks

D.