Latapy will be honoured on Saturday before Falkirk's match against Hibernian.
John Hughes says he would like to see Russell Latapy stay on at Falkirk and become a coach at the club.
The 40-year-old's contract runs out at the end of the current season but Hughes says the Trinidad and Tobago star has a future in management.
"I think he's been one of the top foreign players in Scotland," said the Falkirk manager.
"He's in the top three or four, that's for sure, when you include the Laudrups and all these guys."
Hughes also says the former Hibs and Rangers midfielder is one of the most gifted players he has ever worked with.
The club is holding a special 'Russell Latapy day' on Saturday at the league match against Hibernian to give both sets of fans the opportunity to pay tribute to the player on the occasion of his 40th birthday.
"Five years ago, he was going to retire, and I was a very lucky man to get him to come to Falkirk," said Hughes.
"Some of the stuff he's done at this club has been absolutely outstanding.
"I was fortunate enough to play with him at Hibs and he was just outstanding there too.
"He's brought so much to the club, and any tribute he's getting is richly deserved.
"We've been friends for a long time ever since our Hibs days and we have a great respect for each other."
Hughes was also keen to point out that Latapy's involvement at Falkirk need not come to an end when his contract expires next year.
The Falkirk manager suggested he would like to sit down at the end of the season and discuss a future role for Latapy at the SPL club.
At his time my energies are everything to do with Falkirk until the end of the season, and then I will sit down with all of the parties and we'll decide exactly what is going to happen
"I can't speak highly enough of him," said Hughes.
"He's not finished yet. He still has a massive part to play at Falkirk, and at the end of the season we'll sit down and say 'where do we go from here?'".
"If Russell wants to go somewhere else or pursue something else and there's nothing here for him, then we'll leave on the best of terms."
Latapy was typically modest when asked about the praise being heaped upon him by his manager and insisted he would not considered his future until the end of the current season.
"John has encouraged me to play for the last five years," said Latapy.
"When I got the call from him to come to Falkirk, I was contemplating calling it a day.
"He offered me the opportunity to continue playing, but to also gain experience in the coaching and managerial side of the game and it was an eye-opener for me.
"I think that has also helped me to continue to play because you understand the game a lot better when you get into the coaching side.
"You understand how the whole team operates, and that has prolonged my career.
"At his time my energies are everything to do with Falkirk until the end of the season, and then I will sit down with all of the parties and we'll decide exactly what is going to happen."
This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.