BLUE HILL, Maine — Blue Hill’s treasurer has resigned, almost $11,000 in town funds is unaccounted for and town leaders will discuss what to do about the situation when they meet Friday.

Treasurer Jody Murphy submitted a letter of resignation on Nov. 16 that the Board of Selectmen accepted the following day.

Murphy had been on paid administrative leave since Oct. 5, shortly after auditors conducting a routine annual audit couldn’t find cash associated with four bank deposits of town and regional transfer station funds, Selectman Jim Schatz said.

“None of us are used to this. It is new territory and we want to be respectful of the personnel issues involved and make sure the town is protected. We are being very methodical and careful,” Schatz said Tuesday. “In our minds it is an ongoing investigation.”

The town’s auditor, James Wadman of Ellsworth, called the deposit shortage “pretty significant.”

Town officials declined to comment on whether Murphy’s resignation had anything to do with the deposit discrepancies. Attempts to contact Murphy on Monday and Tuesday were unsuccessful. Her attorney, John Hamer of Rudman Winchell of Bangor, could not be reached for comment.

Town officials have been working with the town’s bonding company, which insures municipal government against loss, to see if the money will be remitted, Schatz said.

Wadman is completing an audit of municipal records, Schatz said. Selectmen have also informed Maine’s state auditor of the discrepancy.

“The selectmen are going through all the proper channels,” Wadman said.

Selectmen are due to meet at 1 p.m. in the town office on Friday.