A method of echo cancellation in hands-free communication, the method comprising: receiving (302; 402), via a receive signal processor, a far-end audio signal; providing (304, 305; 408,410) the far-end audio signal to: an acoustic echo canceller module as a reference signal, and at least one loudspeaker (104 - 106) for playback; determining (306; 404) an external gain value associated with the far-end audio signal including determining a current external playback volume associated with the at least one loudspeaker (104 - 106), the external gain applied to the far-end audio signal downstream of the receive signal processor and prior to playback from the at least one loudspeaker (104 - 106); adjusting at least one parameter of the acoustic echo canceller module based on the external gain value; receiving (310; 412) an input signal to a microphone containing echo of the far-end signal played from the at least one loudspeaker (104 - 106); processing (312; 414) the microphone input signal by the adjusted acoustic echo canceller module to produce an echo-cancelled signal; the method further comprising: performing, by the receive signal processor, a non-linear compression comprising multi-band limiting of the far-end audio signal prior to playback from the at least one loudspeaker (104 - 106), the multi-band limiting comprises dividing a frequency spectrum of the far-end audio signal into a plurality of frequency bands and performing limiting on each frequency band individually; adjusting at least one parameter associated with the non-linear compression based on the current external playback volume, the at least one parameter comprising a limiter threshold for at least one frequency of the plurality of bands; and providing the processed far-end audio signal as the reference signal to the echo canceller module. receiving (302; 402), via a receive signal processor, a far-end audio signal; providing (304, 305; 408,410) the far-end audio signal to: an acoustic echo canceller module as a reference signal, and at least one loudspeaker (104 - 106) for playback; an acoustic echo canceller module as a reference signal, and at least one loudspeaker (104 - 106) for playback; determining (306; 404) an external gain value associated with the far-end audio signal including determining a current external playback volume associated with the at least one loudspeaker (104 - 106), the external gain applied to the far-end audio signal downstream of the receive signal processor and prior to playback from the at least one loudspeaker (104 - 106); adjusting at least one parameter of the acoustic echo canceller module based on the external gain value; receiving (310; 412) an input signal to a microphone containing echo of the far-end signal played from the at least one loudspeaker (104 - 106); processing (312; 414) the microphone input signal by the adjusted acoustic echo canceller module to produce an echo-cancelled signal; the method further comprising: performing, by the receive signal processor, a non-linear compression comprising multi-band limiting of the far-end audio signal prior to playback from the at least one loudspeaker (104 - 106), the multi-band limiting comprises dividing a frequency spectrum of the far-end audio signal into a plurality of frequency bands and performing limiting on each frequency band individually; adjusting at least one parameter associated with the non-linear compression based on the current external playback volume, the at least one parameter comprising a limiter threshold for at least one frequency of the plurality of bands; and providing the processed far-end audio signal as the reference signal to the echo canceller module. performing, by the receive signal processor, a non-linear compression comprising multi-band limiting of the far-end audio signal prior to playback from the at least one loudspeaker (104 - 106), the multi-band limiting comprises dividing a frequency spectrum of the far-end audio signal into a plurality of frequency bands and performing limiting on each frequency band individually; adjusting at least one parameter associated with the non-linear compression based on the current external playback volume, the at least one parameter comprising a limiter threshold for at least one frequency of the plurality of bands; and providing the processed far-end audio signal as the reference signal to the echo canceller module.