Scottish Football Association chief executive David Taylor has revealed that Rangers' offer of compensation for Walter Smith fell 'considerably short' of their demands.
While unveiling Smith as the new Rangers boss earlier today, Ibrox chairman Sir David Murray claimed the SFA's demands were 'unrealistic'.
The SFA have instigated legal moves against Rangers and the former Scotland manger who resigned earlier today.
Taylor said: 'The offer fell short, considerably short of what we were expecting.'
The SFA chief revealed no talks are planned with Rangers over a compromise figure.
But he added: 'I hope a deal will be done still because I think that's the right way forward.'
Taylor added it was a 'serious blow' to lose Smith while the Scots topped their Euro 2008 qualifying group.
He is now turning his full attention to appointing a successor, who he insisted would not be foreign following the disappointing Berti Vogts era.
He would not discuss potential candidates but did praise assistant manger Tommy Burns, one of the frontrunners for the vacant post.
He said: 'Tommy has done very well with us and is part of the extended management team.'