Incumbent Shashi Kant Sharma completes his term as the country's top auditor next month-end.
Mehrishi has emerged as the top choice for the post, the sources said, adding a formal order on this is expected soon.
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The CAG is appointed for a term of six years or till the incumbent attains the age of 65 years, whichever is earlier.
Born on September 25, 1952, Sharma assumed the office in May 2013.
As a constitutional functionary, the CAG is primarily entrusted with the responsibility to audit the accounts of the Union government and of the state governments of India.
CAG reports are laid before Parliament and legislatures of the states.
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