The Board of Control for Cricket in Sri Lanka are currently negotiating through a former England captain, now domiciled in Australia, Tony Greig to obtain Simpson's services for the national team.
The Sri Lanka team is currently without a coach after another former Australian Test cricketer, Sri Lankan-born Davenall Whatmore resigned six months ahead of his two-year contract, to take up a new appointment with English county side, Lancashire.
Sri Lanka have Test tours to New Zealand starting in late February and West Indies in May, in addition to some one-day tournaments coming up in their international calendar for 1996-97.
Cricket Board sources said Simpson with his outstanding record as a former player, captain and coach, would be a much respected figure with the players.
The only snag that may stop Simpson from coming here is that he is available only on a short term basis, Cricket Board sources said.
Simpson (60) was Australia's coach for ten years, serving five two-year terms since 1986.
He was released from his contract after Australia's loss to Sri Lanka in the World Cup final in Lahore in March this year.
During his period as coach, Australia won the World Cup in the subcontinent in 1987, the 'Ashes' series against England both at home and abroad, and regained the Sir Frank Worrell trophy by beating West Indies in the Caribbean last year.