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NSW Waratahs have conceded they need to improve their discipline but say penalties are a source of frustration after their Super Rugby loss to the Brumbies.

As the most penalised team in Super Rugby AU, NSW Waratahs accept their costly ill-discipline needs to improve.

But coach Rob Penney and skipper Rob Simmons were mystified by the swag of penalties that dented their quest to upset the Brumbies at ANZ Stadium on Saturday night.

Early in the match the Brumbies conceded six successive penalties as the Waratahs dominated the set piece and breakdown to lead 15-0.

But by the end of the game, the hosts were on the wrong end of a 13-10 count as they suffered a heart-breaking 24-23 loss.

With scrum and ruck interpretations a long-time frustration of the game, Penney stopped short of criticising referee Angus Gardner's performance.

But he said it was annoying for players who didn't always feel they got the pay they were due, particularly around the breakdown and scrum.

"It's such a difficult game to referee," Penney said.

"You have a really dominant scrum and you get rewarded once and then you don't get rewarded again really, in fact you give away a few.

"It's unfathomable how those conclusions are reached.

"It's a shame it's difficult for the game to make those calls on."

Penney admitted that his team needed to do more in terms of getting back on-side or rolling away from the defensive breakdown.

A bitterly disappointed Simmons questioned the penalty square-up.

"How often do games end up 90/10, it always ends up 50/50, the refs going to bring it back," Simmons said.

"Why? I don't know why that is but if you show dominance why doesn't it keep coming? I don't know."

The Waratahs next face Melbourne, who are coming off the bye, at the SCG on Friday night.