Doug McFarlan at Wolfson has been leading a team to develop an audio card for the Pi in conjunction with Element 14/Farnell. The card, which plugs into the GPIO, features the following:

• 3.5 mm jack (4-pole) for a headset/boom mic combination for gaming or VoIP applications
• 3.5 mm jack for microphone input
• On-board MEMS microphone
• 3.5 mm jack stereo line input for connection to devices such as digital audio players (iPod etc.) or mobile phones
• 3.5 mm jack stereo line output for connection to devices such as external stereo amplifiers or powered speakers
• Phono jack for electrical (not optical) S/PDIF digital input
• On-board class D power amplifier for external speakers, with connection to external power source if needed.
• Small pin header for extra functions if they are low cost, already on-chip, and don’t require any further components

For more information, read the page on element14. There’s a great intro video on there too. The board is not out yet but you can register your interest as per normal on that page.