Iceland 1-4 Scotland: Shelley Kerr's side finish second in Algarve Cup group
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Goals: Scotland Women 4-1 Iceland Women
Scotland are getting "closer and closer" to where they need to be following their dominant win over Iceland in the Algarve Cup, says head coach Shelley Kerr.
Goals from Lizzie Arnot and Erin Cuthbert came after a dominating first-half performance in Parchal.
Kim Little and Arnot again scored either side of a Sara Gunnarsdottir strike to secure second in Group A.
"It's a step forward for us" Kerr told BBC Scotland.
The Scots will play Denmark in their play-off match on Wednesday for fifth place.
The game will take place at 13:15 GMT in the Estadio Algarve where Scotland's men beat Gibraltar 6-0 in October 2015.
"We worked on attacking play in training, five or six key things and I think I saw evidence of every single one of them today," added a delighted Kerr.
"They played a team that's only two places below us in the rankings and not only dominated possession but I think our attacking play, the options we had in attack were absolutely fantastic."
'The third goal was outstanding'
Iceland had beaten Scotland in La Manga in January, but there was never any threat of a repeat of that result as the Scots took a grip of the match from the outset.
The tangible evidence of that came in the shape of Arnot's early goal, her first for her country. Little fired in a corner from the left and when it broke to Arnot, she buried it beyond Sonny Thrainsdottir in the bottom corner.
Scotland were playing with an intensity and at a tempo the Icelanders could not match and Cuthbert's goal deservedly stretched their lead.
Having sent a shot wide from a good position, the tenacious Chelsea forward made up for it a minute later, winning possession just outside the opposition penalty area, allowing Little and Claire Emslie to combine, before side-footing Emslie's cutback past the keeper.
Cuthbert was also involved in Scotland's third. It was her shot that was charged down before Little swept the rebound past Thrainsdottir.
"The third goal was outstanding, I'm desperate to see it back because there was so many good combinations in it," said Kerr.
A rare moment of Scottish slackness allowed Iceland a chink of light two minutes later, as Gunnarsdottir shot low past the otherwise untroubled Shannon Lynn.
But Arnot restored the three-goal advantage, bundling past the keeper, who saved her initial effort following a delicious diagonal ball from Caroline Weir.
"The game plan was to get more players in advanced positions, which Lizzie was, but I think the players were having a little bit of a joke with her about her second goal there," added Kerr.
"But it went in and that's the most important thing."
Watch: Arnot rounds off Scotland scoring