However a Football Federation of Australia (FFA) spokesman said media reports that Houllier had already signed a contract were incorrect.

"Contrary to media reports, the FFA has not signed an agreement with Gerard Houllier for the position of head coach," a statement released on Monday read.

"Talks regarding the Australian head coach position are continuing with a number of candidates, including Gerard Houllier."

FFA officials have made no secret of the fact Houllier is at the top of their list of candidates to replace Hiddink, who accepted a job to coach Russia after taking Australia to the second round of the World Cup last month.

The FFA have also said assistant coach Graham Arnold is expected to lead the Socceroos for the next 12 months and through the Asian Cup qualifiers before the new head coach takes over.

Former Liverpool manager Houllier is currently in charge of French champions Lyon.