Carlo Ancelotti is the Everton board's number one choice to become their next permanent manager, Sky Sports News understands.
Duncan Ferguson would remain as part of the first-team coaching staff should Ancelotti be appointed.
Everton have confirmed Ferguson will remain in interim charge for Wednesday's Carabao Cup quarter-final against Leicester as the search for Marco Silva's successor continues.
Everton majority shareholder Farhad Moshiri wants someone who has won trophies both domestically and in Europe. If he can convince the Italian - who is interested in the job - that his project is an exciting one, that would represent success for Moshiri and also, importantly, the Everton fans.