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mumblesnzFlag for Australia

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Unable to run report receive error: The attempt to connect to the report server failed. Check your connection information and that the report server is a compatible version.

HI experts,

I have a problem when I am trying to run a report from an application. I am running this on a windows7 laptop with SSRS and SQL installed on same computer.
However i get the following error: Unable to run report receive error: The attempt to connect to the report server failed. Check your connection information and that the report server is a compatible version.
Most of the forms I have looked up all related to SQL2005. Has anyone had this problem using Sql2008 or later?
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I had to disable anonymous authentication in the website. impersonation to work anonymous authentication needs to be turned off.
I've requested that this question be closed as follows:

Accepted answer: 0 points for mumblesnz's comment #a38593352

for the following reason:

Found the solution myself