An audio communication system and method with improved acoustic characteristics features a stereo detector that is introduced in the echo canceller of the system. When stereo in far-end audio is detected, converging of the adaptive mono model of the canceller is suspended, and when stereo in far-end audio is not detected, converging of the adaptive stereo model of the canceller is suspended. The system may also be extended with a miscellaneous processing unit configured to attenuate the signal at certain events implying a large stereo echo contribution. A stereo collapsing unit is also introduced on the channels of the far-end audio to remove the stereo image at certain events to further suppress the echo contribution.