Healthcare Improvement Scotland (HIS) visited the Stranraer site in November last year and again in January.
Despite an action plan being put in place, they said they failed to find "significant improvements".
NHS Dumfries and Galloway has apologised for being "unable to demonstrate best standards of care".
The inspections were carried out as part of a programme to check on standards of care for older people requiring acute treatment in Scotland.
Jacqui Macrae, head of quality of care with HIS, said inspectors had identified issues where patient documentation had not been completed or had not been completed correctly.
"Therefore, we were not assured that the care being given was appropriate," she added.
"We were also concerned about leadership and management, and found a lack of willingness from medical staff to ensure that patients had the capacity to consent to treatment."
She said they had asked NHS Dumfries and Galloway to conduct an internal review of all patients in one of the hospital's wards.
"We also asked NHS Dumfries and Galloway to produce an action plan, detailing how immediate improvements would be made to address to issues identified," she said.
However, a return visit failed to identify the improvements hoped for.
"As such, we escalated our concerns to senior management within NHS Dumfries and Galloway," said Ms Macrae.
"We also escalated our concerns to the Scottish government.
"This inspection resulted in 26 areas for improvement which NHS Dumfries and Galloway must address as a matter of priority."
NHS Dumfries and Galloway's Chief Executive Jeff Ace apologised for the situation.
"Whilst it is reassuring that the inspectors witnessed compassionate and skilled interactions between staff and patients, it is clear that we have much work to do to improve the consistency of record keeping, care planning and delivery of best care practice to patients with degrees of confusion or dementia," he said.
"NHS Dumfries and Galloway has accepted all the recommendations contained within the report.
"Of these recommendations 15 were prioritised and had actions taken immediately with the remainder aiming for completion before the end of March 2015.
"We have taken this report extremely seriously and are committed to continuing to work both with local staff and with Scottish government advisors to ensure that we can demonstrate rapid and sustained improvement."
Dumfries and Galloway MP Russell Brown said the report was "utterly damning".
"I think what is so frustrating is the fact that even when the inspectorate carried out a follow up visit a couple of months later there didn't appear to be any significant improvement," he said.
"I am pleased the NHS have apologised and immediately accepted the findings.
"But what patients and their families want to see is action and improvements."
The full report is available online.
An apology has been issued after health inspectors raised concerns about patient care for older people at the Galloway Community Hospital.