In case you see event 1096 (The processing of Group Policy failed) in your eventviewer, you’re experiencing problems with your group policies. The following event occurs several times in your SYSTEM LOG:

Log Name:     System
Source: Microsoft-Windows-GroupPolicy
Event ID: 1096
Level: Error
User: SYSTEM
Description:
The processing of Group Policy failed. Windows could not apply the registry-based policy settings for the Group Policy object LocalGPO. Group Policy settings will not be resolved until this event is resolved. View the event details for more information on the file name and path that caused the failure.

To solve this issue, check the last modified date of the following file:

C:\Windows\System32\GroupPolicy\Machine\    Registry.pol
(note: GroupPolicy is a hidden folder, you may need to enable hidden folders to navigate to this path)

Almost for certain, the last modified date will be a long time ago (or at least earlier than “today”). If this is the case, delete the file REGISTRY.POL, and run “gpupdate /force” from a Command Prompt. This forces the group policies to re-apply. Problem solved :)