Below are some validation steps that should be completed before attempting to install Operations Manager 2007 Reporting.

• Data Warehouse Write account: This account is assigned write permissions on the Data Warehouse database and read permissions on the OperationsManager database.
• Data Reader account: This account is used to define what user SQL Reporting Services uses to run queries against the Operations Manager Reporting Data Warehouse. This account is also used for the SQL Reporting Services IIS application pool account to connect to the RMS.

Note

Before you perform this procedure, be sure that the account you plan to use for the Data Warehouse Write Account has SQL Login rights and is an Administrator on the computers hosting both the Operations Manager database and Reporting data warehouse. Otherwise, setup fails and all changes are rolled back, which might leave SQL Reporting Services in an inoperable state.

All permissions are shown below:

       Make sure the user running setup has following permissions

       User is local administrator (Needed to run MSI, to configure SSRS)

       User is Ops Manager Administrator (Needed to configure Reporting roles, creating instances)

       User is SysAdmin in Ops DB (Needed to configure dwsynch_users role)

       User is SysAdmin in DW DB (Needed to configure OpsMgrWriter, OpsMgrReader roles)

Operations Manager 2007 Reporting requires SQL Reporting Services to be installed and working correctly. Do not run Operations Manager Reporting install until SQL Reporting Services has been validated.

You can validate SQL Reporting Services using the following steps:

1.     Run the Reporting Services Configuration tool, connect to the report server instance you just installed, and review the status indicator for each setting to verify that it is configured.

2.     Open the Services window and verify that the Report Server Windows service is running. To view the status of the Report Server Windows service, click Start, point to Control Panel, double-click Administrative Tools, and then double-click Services. When the list of services appears, scroll to Report Server (MSSQLSERVER). The status should be Started.

3.     Open a browser and type the report server URL in the address bar. The address consists of the server name and the virtual directory name that you specified for the report server during setup. By default, the report server virtual directory is named ReportServer. You can use the following URL to verify report server installation: http://<computer name>/ReportServer<instance name>. The URL will be different if you installed the report server as a named instance. For more information about the URL format, see Configuring Report Server Virtual Directories.

1.     Open a browser and type the Report Manager URL in the address bar. The address consists of the server name and the virtual directory name that you specified for the Report Manager during setup. By default, the Report Manager virtual directory is Reports. You can use the following URL to verify Report Manager installation: http://<computer name>/Reports<instance name>.

2.     Use Report Manager to create a new folder or upload a file to test whether definitions are passed back to the report server database. If these operations are successful, the connection is functional.

For more information on validating SQL Reporting Services go to : http://technet.microsoft.com/en-us/library/ms143773(SQL.90).aspx

Once this validation is complete you can commence installing Operations Manager 2007 Reporting.

 ref: http://blogs.technet.com/momteam/archive/2008/12/04/installing-operations-manager-2007-reporting-successfully.aspx