"There was no arguing between them and they were playing happily together as they normally did," Coroner Elliott said.
The boy took a plastic ball and a child's size golf club, which had a metal head, and asked his sister to move out of the way before swinging the club.
He missed the ball and then saw his sister on the ground.
The boy rushed to tell his father: "Dad, I told [his sister] to keep out of the way, but I hit her".
Some neighbours rushed to help before paramedics took the toddler to Christchurch Hospital. However, she died later that evening.
Forensic pathologist Dr Martin Sage said the girl died from an impact to the left side of her head which resulted in the laceration of the left vertebral artery followed by a subarachnoid haemorrhage.
The coroner noted the fatal injury was similar to the one suffered by Australian cricketer Phil Hughes, who died after being hit by a cricket ball on the base of his skull in 2014.
In his conclusions, Coroner Elliott made comments that he hoped the boy would "keep in mind" as he grows up.
He noted that people play with golf clubs, hockey sticks, cricket bats and other sporting equipment in their backyards, parks and sporting fields across New Zealand every day. Accidental injuries are extremely rare, Elliott said.
The coroner said it was clear that the boy loved his sister very much.
"[They] chose to spend most of their time at home in each other's company. They enjoyed playing together and had a loving and positive relationship," Coroner Elliott said.
He said the boy had been open and honest with police and had acted "very responsibly for a child of his age", especially in showing the awareness to ask his sister to move away before swinging the club, and then in alerting his father straight away.
"Sometimes it can be said that a person whose actions contributed to a death should have done something differently. I would like to make it very clear to [the boy] that this is not such a case," the coroner concluded.
The coroner offered his condolences to the family and wished them well for the future.