Many of the early episodes of the third season had to be shot out of sequence to accommodate the fact that Kate Isitt had just had a baby, and so wasn't always available.
Though some scenes are shot away from the studio audience (the nude scenes for example and exteriors) no "canned laughter" is used. The scenes are played on monitor for the studio audience and their reactions are real.
Sally: [singing]
I'm Susan the happy trotting elf! I trot and trot and bounce and bounce and smile a lot and that's what counts! I'm Susan the happy trotting smile a lotting elf! I'm polite so just for clarity, when I'm cross I say "Apparently!"