Rangers FC manager Walter Smith has signed a one-year deal to stay at Ibrox for what will be his final season in football.

Smith has been working without a contract since January prompting speculation that the 62-year-old would call time on his second spell at Rangers this summer, having led the club to the Scottish title and League Cup this term. However, Smith has confirmed he will remain in charge for one more season and then hand over to his assistants Ally McCoist and Kenny McDowall.

"I have given this decision a great deal of thought," said Smith, who has won 19 major domestic honours in his two stints as Rangers manager. "I am wholly committed to managing the club next season and when it comes to the end of next season I firmly believe that Ally and Kenny would do a great job and I am glad everybody at the club shares that view."

Club chairman Alistair Johnston added: "Walter's continued presence within Rangers was something I was determined to make happen and [chief executive] Martin Bain was instrumental in creating the environment that encouraged Walter, Ally and Kenny to remain on board."