WSUS Post Installation Failed – Attempted to perform an unauthorized operation

<WSUSServerName>

I have experienced this issue on brand new Windows Server 2012 R2 Virtual Machine on Hyper-V. After installation of the WSUS role, the post configuration wizard fails with “Fatal Error: Attempted to perform an unauthorized operation”

Below is a part of Log file content which is provided by the error.

Fetching content directory...
 Fetching ContentDir from registry store
 Value is D:\WSUS
 Fetching group SIDs...
 Fetching WsusAdministratorsSid from registry store
 Value is S-1-5-21-2831515454-823550688-262756524-1001
 Fetching WsusReportersSid from registry store
 Value is S-1-5-21-2831515454-823550688-262756524-1002
 Creating group principals...
 Granting directory permissions...
 System.UnauthorizedAccessException: Attempted to perform an unauthorized operation.
     at System.Security.AccessControl.Win32.SetSecurityInfo(ResourceType type, String name, SafeHandle handle, SecurityInfos securityInformation, SecurityIdentifier owner, SecurityIdentifier group, GenericAcl sacl, GenericAcl dacl)
     at System.Security.AccessControl.NativeObjectSecurity.Persist(String name, SafeHandle handle, AccessControlSections includeSections, Object exceptionContext)
     at System.Security.AccessControl.FileSystemSecurity.Persist(String fullPath)
     at System.IO.DirectoryInfo.SetAccessControl(DirectorySecurity directorySecurity)
     at Microsoft.UpdateServices.Administration.ConfigurePermissions.GrantDirectoryPermissions()
     at Microsoft.UpdateServices.Administration.ConfigurePermissions.Configure()
     at Microsoft.UpdateServices.Administration.PostInstall.Run()
     at Microsoft.UpdateServices.Administration.PostInstall.Execute(String[] arguments)

This is relate to folder permission and for fix this issue set below permissions in respective folders. *Local Domain Name is blocked by a black square.
WSUS Content Folder Permission
D:\WSUS
NETWORK SERVICE = Full Control

D:\WSUS\WsusContent
NETWORK SERVICE = Full Control

Creator Owner = Special permissions

System = Full Control

Administrators (<WSUSServerName>\Administrators) = Full Control

Users (<DomainName>\Users) = Read & Execute, List folder contents, Read, Special permissions

Folder:
%ProgramFiles%\Update Services\LogFiles

After setting up above permissions restart the server and try to rerun the post installation wizard. It should complete without any issue.

WSUS Content Folder Permission

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