SPENCER — Former town clerk Brenda Craig has pleaded not guilty to three felony counts of theft and a misdemeanor count of official misconduct.

Craig appeared Tuesday before Judge Frank Nardi in Owen Circuit Court to enter the pleas to the charges, which grew out of a routine state audit of the town's books.

The audit cited Craig for allegedly receiving $2,318 more from the town than was accounted for by the official town payroll or by the town's salary ordinance.

The audit also showed problems with her office's bookkeeping, budget and payroll, including incomplete records, overspent line items and errors in keeping accurate accounts.

The State Board of Accounts requested that Craig repay the overpayments, and she did so.

"Brenda's been exceptionally cooperative in this matter and we hope to resolve it," her attorney, Tom Spencer, said Wednesday.

But a copy of the audit still was automatically forwarded to Owen County Prosecutor Allan Fountain. And after he further investigated the case, he decided to file charges.

The three theft counts allege that Craig exerted "unauthorized control" over $773 on each of three dates, Nov. 18, Nov. 29 and Dec. 13, 1999.

The misdemeanor count of official misconduct alleged she issued payroll checks in advance of pay periods.

A warrant was issued against Craig, who turned herself into the sheriff Tuesday morning, posted the required $30,000 bond and was released.

Craig, 49, was appointed town clerk in 1991 to fill a vacancy and was elected that fall and re-elected in 1995 and 1999. She resigned the post last August.

Pretrial conferences in the case are set for April 19 and May 23. No trial date has been set.