Posts on the Iron-Bru.net messageboard had linked the Clarets with a £300,000 bid for Sharp, prompting a hands-off warning from Scunthorpe boss Brian Laws.
But after fresh speculation suggesting a move is imminent, Cotterill has claimed he has no money to spend on players.
He told Burnley's official website: "Someone is being very active promoting him.
"But if I had £300,000 to spend I would have spent it by now."