Private Jason Challis, 25, from Geelong, was accidentally shot in the head while crouching behind a building in an urban warfare exercise south of Darwin on May 10, 2017.

He died because of a systemic failure in which army brass refused to enforce their own safety policies ensuring a mandatory walk-through or dry rehearsal before a live fire exercise, Coroner Greg Cavanagh said in findings released on Wednesday.

Pte Challis had been in the army for 10 months and, as with most of his section, had not previously trained on a complex urban warfare range.

Despite that, they were not given the benefit of a blank-fire rehearsal and did not know the layout of the mock village.

They quickly got into trouble during the exercise, which had to be stopped, but no one noticed Pte Challis missing or saw him at a dangerous no-go zone behind the mock building made of plywood and hessian.

Another soldier shot a dummy target inside but two bullets passed through the wall and hit Pte Challis in the head, killing him.

Despite the army agreeing to coroner's recommendations after the 2009 death of Lance Corporal Mason Edwards in similar circumstances, it was not ensuring practices such as walk-throughs or the marking of no-go zones for exercises were mandatory.

That was partly due to a strongly held army tenet and mindset that live-fire exercises should be "dynamic" rather than staged to better prepare the troops for real combat.

"It's a hard job to maintain a training level," the acting commanding officer of Pte Challis' section told last November's coronial inquest.

"I still believe you can't continuously have to start from the beginning again and work your way up or we'll never meet the directions of the Australian Government to protect this country if you continually do that."

Mr Cavanagh accepted it was a difficult balance for the army but said "I encourage them to resolve the competing requirements between safe training and dynamic training (or testing) in an explicit manner."

"In my view, the evidence establishes that the exercise that led to the death of this young man was a shambles," he said.

"If he had been given a walk-through, a dry-fire rehearsal or a blank-fire rehearsal it is unimaginable that he would have been at the back of the building in line with the concealed target.

"In this case it was not simply "human factors" that intervened. There was catastrophic systemic failure."

Mr Cavanagh made three recommendations, including that the army make it explicit what rehearsals are mandatorily required and that they be highlighted and easily noted by troops when they read the documents.

No-go areas behind concealed targets should also be clearly marked, he said.

Australian Associated Press