Application doesn't have permissions for server-side record/append of streams

I am getting this error while recording a video on flash media server. I have configured everything as given in application/live/readme.txt file. I have created a new folder <record> (let say) in application directory,changed  <LIVE_DIR> to point to <record> folder in fms.ini file.

Moreover is there a need to place main.far file inside this newly created folder <record> along with main.asc or only main.asc is required? Becuase if i don't place main.far , i am not able to load application<record> using administrative console. Please help.