This guide is intended to outline the software installation and configuration to start building custom SSRS 2005 for use within Dynamics AX.
1.0) Install SQL Server 2005 Developer edition
Select the following (at minimum):-

Make sure the following are to be installed:-
• Reporting Services/Shared Tools
• Client Components/Business Intelligence Development Studio (cut down version of Visual Studio 2005)

2.0) Install Dynamics AX 2009 Client Tools
The following will need to be installed:-
• Client
• Reporting Extensions
• Reporting Tools
• .Net Business Connector
2.1) Instance Type

2.2) Components

2.21) Components - Possible Issues
While trying to install Dynamics AX 2009 Client Component, you may get the following error:-
Setup has detected that you are installing Reporting extensions on an operating system that is not supported for Microsoft Dynamics AX. The minimum supported server operating system is Microsoft Windows 2003 with Server Pack 2

Click Yes and you will then see the following error:-
You must install SQL Server 2005 Reporting Services Service Pack 2 before installing the reporting extensions.

After trying to install SQL Services Packs, uninstalling SQL Server etc the only option that seem to work was early option pill from the following website:-
http://community.dynamics.com/product/ax/f/33/p/12322/31719.aspx
The instructions followed are:-
The same problem with SQL Server 2005 SP3, this fix our problem:
1. Open the registry and find the HKLM\SOFTWARE\Microsoft\Microsoft SQL Server key.
2. Right-click the HKLM\SOFTWARE\Microsoft\Microsoft SQL Server key and choose New > Key.
3. Name the key Reporting Services.
4. Right-click the Reporting Services key and choose New > String Value.
5. Name the string value Version. The Version string value will have a type of REG_SZ.
6. Double-click the Version string value and enter 9.00.3042.00 as the value data. Click OK.
3.0) Install Dynamics AX Report Dlls
There are some Dynamics AX Dlls that are used in the SQL Server Reporting Services Reports:-
• Microsoft.Dynamics.Framework.Design.Reports.dll
• Microsoft.Dynamics.Framework.Reports.dll
• Microsoft.Dynamics.Framework.ReportsDeployment.dll
• Microsoft.Dynamics.Framework.ReportsExtensions.dll
• SysSecurity.BusinessLogic.dll
They all need to be placed in the Reporting Services bin folder e.g.:-
C:\Program Files\Microsoft SQL Server\MSSQL.3\Reporting Services\ReportServer\bin
I also install them in medicine abortion the GAC (C:\Windows\Assembly folder) apart from SysSecurity.BusinessLogic.dll which is not strongly named assembly.