Narrative:

Following before takeoff procedures; we requested takeoff and to hold short for our IFR release. With our takeoff clearance; came [our] departure [clearance] and [departure control] frequency. Upon readback; the student began moving to take the runway and crossed the hold-short line without checking final. Either following this transmission or just before our clearance; an aircraft on final transmitted; ' on final.' shortly upon reaching the runway; we were ordered to stop and the other aircraft told to go-around. The controller said he thought we had heard him cancel our takeoff clearance. Neither I; my student; or the pilot of another airplane holding short in sequence heard this cancellation; as evidenced by his transmission saying the same.the major contributing factor to the incident; regardless of procedural fault; was my failure to check final for approaching aircraft prior to the student taking the runway. He; as a commercial applicant; should also have checked. I believe the flight and the departure routing were at the front of his attention. I don't know why I didn't check; it is usually part of my procedure.human factors would include the fact that I am a cfii; but have low time; both giving instruction and in IMC. I was instructing on my first long cross-country IFR training flight with a relatively unknown student. We were distracted by reports of turbulence for our route of flight and my student was; perhaps; overly focused on the IFR portion of the flight because of fear or lack of familiarity with clearance.

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Original NASA ASRS Text

Title: A CFII and his Commercial student were distracted and failed to note another aircraft on final when they were cleared for takeoff. Although the Tower believed he had subsequently canceled their takeoff clearance; neither pilot nor the pilot of another aircraft heard any such transmission. The landing aircraft was directed to make a go-around.

Narrative: Following before takeoff procedures; we requested takeoff and to hold short for our IFR release. With our takeoff clearance; came [our] departure [clearance] and [Departure Control] frequency. Upon readback; the student began moving to take the runway and crossed the hold-short line without checking final. Either following this transmission or just before our clearance; an aircraft on final transmitted; ' on final.' Shortly upon reaching the runway; we were ordered to stop and the other aircraft told to go-around. The Controller said he thought we had heard him cancel our takeoff clearance. Neither I; my student; or the pilot of another airplane holding short in sequence heard this cancellation; as evidenced by his transmission saying the same.The major contributing factor to the incident; regardless of procedural fault; was my failure to check final for approaching aircraft prior to the student taking the runway. He; as a commercial applicant; should also have checked. I believe the flight and the departure routing were at the front of his attention. I don't know why I didn't check; it is usually part of my procedure.Human Factors would include the fact that I am a CFII; but have low time; both giving instruction and in IMC. I was instructing on my first long cross-country IFR training flight with a relatively unknown student. We were distracted by reports of turbulence for our route of flight and my student was; perhaps; overly focused on the IFR portion of the flight because of fear or lack of familiarity with clearance.

Data retrieved from NASA's ASRS site as of July 2013 and automatically converted to unabbreviated mixed upper/lowercase text. This report is for informational purposes with no guarantee of accuracy. See NASA's ASRS site for official report.