On upgrading Microsoft SQL Server 2008R To MS SQL Server 2012 I was keep getting error
Rule “Valid Database compatibility level and successful connection” failed
The report server database is not supported compatibility level…
I installed latest service pack for SQL Server 2008R2 but did not solve the issue.
Later looked at reporting server (MS SQL Server 2008 R2>Configuration Tools>Reporting Services Configuration Manager)
Open it and select Database from navigation on the left
make sure SQL Server Name: has a valid SQL Server name, in my case it was pointing to wrong server which did not exist
Click on Change Database and follow the steps.
Once completed go back to upgrade process of SQL Server and all should be good.