Fabio Capello is poised to be confirmed as the new England coach after the Football Association board approved his appointment.
The FA is happy with the Italian's £4m-a-year salary but the finer points of the contract are being worked on.
"Discussions have continued throughout the day between The FA and Fabio Capello’s advisors," read a statement from FA Director of Communications Adrian Bevington.
"The FA Board has also today approved Capello’s appointment as England Manager subject to the successful conclusion of these contract negotiations. These will continue tomorrow.
"I want to stress that there are no problems and that we are going through the necessary process to reach a successful conclusion."
It is believed that one of the issues set to be ironed out is Capello's choice of sporting director Franco Baldini, who he worked with at Roma and Real Madrid, in an all-Italian backroom staff.
He wants Baldini to identify players and watch opposition teams, while he will likely appoint Italo Galbiati as assistant, Massimo Neri as fitness coach and Franco Tancredi as goalkeeping coach.
The former AC Milan, Real Madrid, Juventus and Roma coach is the FA's number one target following Jose Mourinho's decision to pull out of the running.
Capello met with FA chief executive Brian Barwick and director of football Sir Trevor Brooking on Thursday to discuss becoming Steve McClaren's successor, before travelling back to Milan.
Those talks in London were described as "extremely positive."
Capello has enjoyed success in both Italy and Spain. He has won nine league titles in 16 years as a coach, picking up silverware with all four clubs - AC Milan, Real Madrid, Roma and Juventus - he has been in charge of.
He won the Champions League with Milan in 1994 and was also an accomplished player, winning 32 caps for the Azzurri.