ESPNSTAR.my had been told by sources in Kelantan on Monday, that the 45-year-old Englishman, who is in his second stint with the club, was set to part ways with the Red Warriors before the end of the month.
His decision, insiders had claimed, was based on a deteriorating relation with Kelantan Football Association President Tan Sri Annuar Musa.
However, in the wake of Tuesday's 2-1 defeat to Selangor - Kelantan's first loss of the season - Butler gently sidestepped the issue of his immediate future, although he did concede that he has plenty of thinking to do regarding his current role.
"I don't really want to comment on the report, I have no idea where that came from," Butler, who has been asked by Annuar to decide whether he wants to stay or go, told ESPNSTAR.my.
"However, I obviously have to sit down and think about certain situations here at Kelantan. With dignity and honesty, I have to look at what I want to do and what I stand for as a person.
"I have to ask myself a few questions such as why do I do this job?
"Unfortunately at times, you can't do the job the way you would like to do it. I came back here with really good players and every intention to take the club forward. I'm not here to criticize anybody, but I honestly feel I have to ask myself a few questions," he added.
Ahead of the clash with Selangor, sources had also revealed to ESPNSTAR.my that Butler was no longer in charge of the hiring and firing of foreign players, with that particular role now being handled by Annuar.
Annuar's decision has apparently been accepted - albeit reluctantly - by Butler, although the one-time midfielder insists he is hugely perplexed by the situation - especially when one of his original signings was deregistered without his knowledge and he was forced to use a player on Tuesday that he had never seen play.
"Tan Sri (Annuar Musa) has decided to take on that responsibility (of hiring foreign players), and I have to respect that if that's the way he wants it to be. He's in charge and he's the pay master.
"It is the first time I've ever experienced that, but as a coach, I have to ask myself whether or not I want to work that way because, in the end, it is nice to be in charge of your own destiny. It is nice to be able to pick your own players.
"I've used a player in the second half against Selangor - Onyekachi Nwoha - who I have never seen play. Where I come from, that is not professional. I think the ambience of the team was disrupted somewhat.
"Mohammed Gaddhar has been deregistered and Nwoha just came in. It would have been nice to have been informed about the foreign players," Butler concluded.
According to ESPNSTAR.my sources, Kelantan have already begun the search for Butler's replacement, with former Kelantan coach Dato' M Karathu heavily tipped to return to the position he vacated late last year.