Ater configuring the Startup mode and security settings on the File Replication service ( NtFrs) via Group Policy, your Application event log contains:
Event Type: Warning                              Event Source: SceCli                              Event Category: None                              Event ID: 1202                              Date: 1/4/2001                              Time: 1:01:30 PM                              User: N/A                              Computer: Server                              Description: Security policies are propagated with warning. 0x5 : Access is denied.                                           Please look for more details in Troubleshooting section in Security Help.                               Event Type: Error                              Event Source: Userenv                              Event Category: None                              Event ID: 1000                              Date: 1/4/2001                              Time: 1:01:30 PM                              User: NT AUTHORITY\SYSTEM                              Computer: Server                              Description: The Group Policy client-side extension Security was passed flags (17) and returned a failure status code of (5).
If you turned on Security Configuration Client logging, the %SystemRoot%\Security\logs\Winlogon.log contains:
Configure NtFrs.                              Warning 5: Access is denied.                              Error opening NtFrs.                              General Service configuration completed with error.
The policy engine no longer has the permissions it requires to set security. to fix the problem:

1. Use Group Policy to navigate to Computer Configuration\Windows Settings\Security Settings\System Services.

2. Right-click File Replication Service and press Security.

3. Grant the System and Administrators groups Full Control.

4. Force replication with SECEDIT /REFRESHPOLICY MACHINE_POLICY /ENFORCE.

5. Use Regedt32 to navigate to HKEY_LOCAL_MACHINE\System\CurrentControlSet\Services\NTFRS.

6. Delete the Security sub-key.

7. Restart the computer.

8. To verify that the fix has worked, look for consecutive Event ID 1704 messages in the Application event log.

NOTE: This problem is NOT unique to NtFrs and can happen to other services you configure.