A headcount error meant Kaylee was trapped under the boat for 90 minutes before it was noticed she was missing.
She had been wearing the wrong type of life jacket, which resulted in her being pinned beneath the boat.
Kaylee was one of 34 cadets on the training exercise when her boat overturned.
Sheriff Alasdair MacFadyen presided over a 10-day fatal accident inquiry.
He said the inquiry had found that a number of precautions could have been taken which would have avoided the accident or prevented Kaylee's death.
Kaylee McIntosh drowned after a boating accident in 2007
Kaylee's mother Lesley said she was "angry, disappointed and disgusted" at the sheriff's findings.
"We don't think he's done Kaylee justice and that's what we were looking for," she said.
"It tells us all the things that went wrong, most of which we already knew. But we were looking for some really tough recommendations to prevent something like this happening again and they are just not there."
Her father said: "Kaylee didn't die because someone made a silly mistake. She died because of a horrific catalogue of reckless and irresponsible conduct by those in charge.
"We believe that amounts to criminal conduct and there have to be criminal prosecutions against those responsible."
Brigadier David Allfrey, commanding officer of 51 Brigade - who are responsible for the Army Reserve and Cadets - said: "The loss of any child in these circumstances is inexcusable. We are deeply sorry for the failings that contributed to Kaylee's death.
"This long inquiry process must have been unimaginably difficult for the McIntosh family, but it is very necessary to ensure everything that can be learnt, is learnt. The sheriff's determination today is a sober and comprehensive judgement, but contains no surprises.
"We will look at it in detail to see if there is any more we can do, in addition to what we have already done, to improve cadet safety."
He added: "The next stage is to determine responsibility and culpability, and it would be inappropriate for me to say anything that would compromise that legal process.
"I wish to reiterate our total commitment to the McIntosh family. I absolutely recognise they are extremely angry."
In his findings, the sheriff said Kaylee's parents had attended court throughout most of the inquiry.
"Their quiet dignity and concentration when hearing about the final hours of their daughter was both impressive and, to quote a witness, humbling," he said.
"I can only hope that the public exploration of the circumstances of Kaylee's death and this determination provide them with some explanation as to how their tragic loss occurred and might go some way to reduce the risk of any other parents finding themselves in such a situation in the future."
In his findings, the sheriff highlighted a number of factors which had caused the accident, including the overloading of the boat.
He said it was being operated in weather conditions which were "at or beyond its design capacity" and that the self-bailing devices were not opened until just before the vessel capsized.
Sheriff MacFadyen said a number of "reasonable precautions" could have helped avoid the accident.
These included getting an up-to-date weather forecast, a detailed risk assessment and appointing a separate safety officer.
The sheriff added that the reasonable precautions which could have avoided Kaylee's death included taking a head count of those on board the vessel when it set off and after the accident, and the issuing of appropriate life-saving equipment.
However, he said it had been "reassuring" to hear that the Army and the cadet force were not complacent about the circumstances leading to Kaylee's death and that changes in procedures had been or would be put in place.
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