The Minister for Defence, Senator John Faulkner, launched the Commission of Inquiry Report in Canberra Wednesday, after Terence Cole QC handed down his findings in a three-volume, 1350-page report which included the review of almost 31,000 archival records.

Sydney sank on 19 November 1941, following an engagement with the German raider HSK Kormoran, which was disguised as a Dutch merchant vessel.

Cole eased concerns around speculation that survivors had been machine-gunned by the German vessel after it had unleashed a tornado on the ship, and instead put the Sydney's commander, Captain Joseph Burnett in the spotlight, by asking why the ship was sailing within range of the Kormoran.

He said that the inquiry's key findings confirm that "accounts provided by the HSK Kormoran of survivors of Sydney's last movements and of the damage she sustained during the engagement with the German raider are correct". However, noted Cole, Burnett was performing his military duty in seeking to identify the unknown ship.

"The Commanding Officer of HMAS Sydney II was not expecting to encounter any merchant ship in the location where he encountered Kormoran," he said. "That knowledge, together with his knowledge of the possible presence of a German raider, should have caused the sighted vessel to be treated as suspicious."

Cole added that all other conspiracy theories and speculations reported to the inquiry were found to have no substance whatsoever.

Faulkner thanked Cole for his "painstaking work" on the report, noting that the finding offers Australians confirmation of the circumstances surrounding the loss of the ship.