Daly assumed command of the 2/10th battalion on 14 October 1944. The battalion was located at Kairi on the Atherton Tableland in Far North Queensland and was heavily engaged in training and refitting, having returned to Australia in May 1944 following the fighting in the Ramu Valley. The battalion had lost sixteen killed and thirty-one wounded during the campaign phases in the Finisterres, and underwent a period of rebuilding; as the battalion history noted, reinforcements ‘were received and welcomed as the battalion was considerably under strength…brought about by large numbers being medically down-graded or discharged as medically unfit’.

There can have been relatively few men in the battalion with direct experience of the new commanding officer from his days as the unit's adjutant at the war's beginning. Casualty rates among infantry battalions were nowhere near as severe in the Second World War as they had been in the Great War (unless one was unlucky enough to be in the 8th Division and suffered under the vicious bastardry of Japanese prisoner administration), but turnover within a battalion across five or six years of war was still considerable. Disease rates in New Guinea and the islands were high, even with strict enforcement of anti-malarial and other hygiene regimes. In the course of the war the 2/10th Battalion suffered 938 casualties of all kinds (killed in action, died of wounds or disease, injured or prisoners of war), which was roughly the whole of the battalion's strength at any given point in time. Admittedly imperfect records gave a total of 167 officers and 3274 other ranks as having served on the battalion's strength during the war. On top of the obvious wastage through active service, officers and men were posted to training establishments, to other units on promotion, or had their medical status revised and were thus no longer fit or suitable for deployment in a combat unit.