In an inspection report of the Moray school published this week, HMIE says that the developments had not been sufficiently well-thought through, supported or monitored. Timetabling problems also meant that, in some subjects, pupils were being taught at too many levels in the same class and teachers had difficulty meeting their learning needs.
The school's efforts in meeting pupils' needs and attainment in S5S6 were said to be "weak", the lowest rating.
Keith Grammar has been at the forefront of moves to exploit the Scottish Executive's green light for greater curricular flexibility. The move led Steven Purcell, Glasgow Council leader, to say he wants all secondary schools in the city to adopt a similar model of accelerated Standard grades, thus leaving an extra year for pupils to sit Highers.
The Keith Grammar project compresses the coursework of the first two years into S1 and starts Standard grade a year early in S3. An evaluation of the first phase last April found that most of the S2 pupils were better motivated and worked with greater application.
However, the researchers found concerns among teachers and parents about the ability of less able pupils to cope and about their having to choose exam subjects after only a year in secondary.
Graham Donaldson, senior chief inspector of HMIE, struck a note of caution over moves to lower the age at which pupils sit external exams when he addressed an education conference of the Educational Institute of Scotland last year.
He said: "We must all continue to probe the educational validity and impact of early presentation of entire cohorts. That means looking at opportunity cost -what is being lost as well as what is being gained."
The HMIE report highlights some of the logistical issues involved in carrying out such a major innovation to the organisation of S1-3 and S4-6 in a school with 490 pupils.
The report states: "While it was too early to evaluate the overall success of this initiative, it was clear that its current effectiveness had been limited by gaps in the school's capacity for successful implementation.
"Learning and teaching were not of a sufficiently high quality to deliver the new curriculum effectively. In addition, there was a lack of rigour in planning for the outworking of the new curriculum, and for timetabling and resourcing its delivery in transitional and subsequent years. The progress of the initiative, and of the pupils involved, was not systematically monitored."
John Aitken, the headteacher, was praised for his commitment to inclusion and high expectations for pupils' achievements. However, the report added that he and his senior management team had not "planned, monitored and evaluated the curriculum innovations rigorously enough for prompt action to be taken to ensure that pupils gained from them at all stages".
Despite the criticisms, however, inspectors acknowledged signs of improved motivation and attitudes to learning in S2 in the light of the curricular changes. The school was also praised for the high standards of its pupils'
behaviour, its partnership with parents, and the participation and success of pupils in a wide range of extra-curricular activites.
George Sinclair, head of educational development services in Moray Council, said the school was already addressing a number of areas, including the range of vocational courses available for the senior school. These were being funded in part by Lord Laidlaw, the businessman and Conservative Party backer, who was brought up in Keith and last year gave pound;40,000 towards expanding the school's vocational skills programme.
Headteacher Mr Aitken said: "What we have in place this year is a major alteration to the senior curriculum, and the inspection took place in the first few weeks of its implementation."
He added that the school's own evaluation had already picked up some concerns which were similar to those expressed by HMIE, and that they had been dealt with.
"I am confident that we are on the right track but undoubtedly it is not the easiest thing in the world to implement such a massive innovation," Mr Aitken said.
A spokeswoman for the Scottish Executive said: "Ministers are clear that, in introducing curricular change, they never said it would work for everyone. When using the flexibility as Keith has done - condensing S1 and S2 - the needs of the individual pupils should always be taken into account."