1. Make sure Reporting Services is up and running in Sharepoint Integration Mode
2. Enable Reporting Services for the site, test locally.
3. In IIS create a new Virtual Directory for the ReportBuilder at its default path (C:\Program Files\Common Files\Microsoft Shared\Web Server Extensions\12\ISAPI\ReportBuilder).
4. Click “Create” on the “Application Name” section.
5. Ensure anonymous access is checked for the application, and ensure that anonymous permissions have been granted on the folder. Unchecking “Integrated Windows Authentication” also may be a good idea.