Nearly 3200 high risk offenders were sentenced to community orders in 2016, supervised by too-few and under-trained Corrections Victoria staff.
Almost one third of the high risk offenders on community corrections orders are also expected to reoffend, a report by Auditor-General Andrew Greaves released on Wednesday reveals.
Legislative change since 2011 has resulted in a massive jump offenders on CCOs - up from 5871 in 2013 to 11,730 in 2016.
And the number of high risk offenders also rose dramatically, 285 in 2013 to 3180 last year.
"Current practices for managing offenders are not effective due to the overwhelming number of offenders and the lack of trained staff," Mr Greaves wrote.
Because many offenders are not being risk-assessed by deadlines and due to "excessive" wait times for support programs, Corrections Victoria "cannot demonstrate that it is effectively reducing risks to the community," the report reads.
Mr Greaves found operational problems restricted information sharing between Victoria Police and Corrections staff, which also impeded the effective management of some offenders.
It means case managers were sometimes unaware of an offender's escalating risk.
According to the report, Community Correctional Services recorded at least six serious cases in which a supervised offender had been in contact with police, sometimes multiple times, before allegedly committing serious crimes.
Victoria is also one of the least successful states when it comes to offenders completing CCOs, second behind Western Australia.
The report makes 12 recommendations to Corrections Victoria, including reviewing the management of offenders who breach conditions, and two recommendations to Victoria Police.
Corrections Victoria is already in the process of implementing 11 of the recommendations as part of reforms announced by the state government.
In October, the government announced mandatory jail for serious and violent crimes like rape, child sex abuse and commercial drug trafficking.
Opposition corrections spokesman Ed O'Donohue said more still needed to be done.
"We've been warning about many of these issues now for months and months and months, and we've seen little if no action from the four corrections ministers we've had in just 12 months," he told reporters.