Elections watchdogs have launched a probe into the Scottish Liberal Democrats’ spending in the 2016 Holyrood campaign.

The Electoral Commission confirmed it had received a complaint and was now looking at whether the party’s return was “true and accurate”.

It is understood the investigation will consider if spending was correctly attributed between the party and the candidates.

A spokeswoman for the Commission said “The Electoral Commission has opened an investigation into the Liberal Democrat Party’s spending return at the 2016 Scottish Parliament election.”

The Liberal Democrats insisted that all spending was “apportioned correctly”, with the party making it clear it has “full confidence that there is no substance to this complaint”.

It comes four months after Scottish prosecutors announced no action was being taken against a Liberal Democrat MSP after Police Scotland conducted an investigation into his campaign spending.

Alex Cole-Hamilton won the Edinburgh West seat from the SNP by 2,960 votes in May 2016.

The Crown Office and Procurator Fiscal Service (COPFS) concluded in October 2017 that no proceedings should be taken at this time following a “full and careful” look at the circumstances of the case.

Mr Cole-Hamilton, who is the Scottish Liberal Democrat health spokesman, had fought the Edinburgh West constituency but was also a candidate on the party’s list for the Lothians region for Holyrood.

The Electoral Commission spokeswoman said: “The Electoral Commission is responsible for investigating potential breaches of the party spending rules at Scottish Parliament elections. Police Scotland are responsible for investigating potential breaches of candidate spending rules.

“The Commission was aware that there was already an ongoing Police Scotland investigation into Liberal Democrat candidate spending at the same election and we considered it appropriate to await the outcome of that investigation before considering whether to open an investigation into party spending.”

A spokesman for the Scottish Liberal Democrats said: “This is a classic SNP tactic when they have lost an election. Last year they wasted 13 months of police time with their complaint about the election in Edinburgh Western, and the police found there was no case to answer.

“All expenditure in this election was apportioned correctly and clearly identified in our election return which is a matter of public record. We have full confidence that there is no substance to this complaint.

“Perhaps the SNP should spend less time whinging when they lose an election and more time addressing the problems they have created for themselves in education, health and the police service. It’s no wonder that their government are on the slide.”

An SNP spokesman said: “The Lib Dems have a track record in failing to properly declare election expenditure.

“The widespread suspicion is the Lib Dems wrongly declare constituency expenses as party expenses to disguise exceeding local spending limits.

“Something stinks about the way the Lib Dems go about election spending. With thousands of pounds of fines under their belt, it’s about time they cleaned up their act.”