1. If you are running MOSS 2007 on Windows Server 2003 the you have to download and install PowerShell from http://support.microsoft.com/kb/968930. Windows Server 2008  natively supports PowerShell.
2. Set the  Execution Policy to 'RemoteSigned'. You can check it by running 'Get-ExecutionPolicy' cmdlet
   The default execution policy for PowerShell is “Restricted” (commands only, not scripts)     

# All scripts running locally are allowed

Set-ExecutionPolicy RemoteSigned

This means downloaded scripts must be signed by a trusted publisher before they can be run.

• Using the Set-ExecutionPolicy Cmdlet      
• How does the RemoteSigned execution policy work?

     3. You need to load the SharePoint assemblies with the following command

#    Load the SharePoint assemblies

[Void][System.Reflection.Assembly]::LoadWithPartialName("Microsoft.SharePoint")

A bunch of PowerShell scripts are available at http://www.powershell.nu/2009/09/08/moss-2007-script-collection

After installing the update KB2756920 on a Windows Server 2008 R2/Windows 7 RTM  computer running SharePoint Server 2010 with previously installed hotfixes for .NET 3.5 SP1. on the server, the following exception is thrown when any WCF service is hosted on IIS using HTTPS

Server Error in ‘/SecurtyTokenServiceApplication’ Application
Method not found: ‘System.String System.ServiceModel.Activation.iis7helper.extendedprotectiondotlessspnnotenabledthrowhelper(system.object)’

An exception occurred when trying to issue security token: The requested service, 'http://localhost:32843/SecurityTokenServiceApplication/securitytoken.svc/actas' could not be activated. See the server's diagnostic trace logs for more information..

Exception occurred while connecting to WCF endpoint: System.ServiceModel.ServiceActivationException: The requested service, 'http://localhost:32843/SecurityTokenServiceApplication/securitytoken.svc/actas'
could not be activated due to an exception during compilation. See the server's diagnostic trace logs for more information. Server stack trace:    
at System.ServiceModel.Channels.HttpChannelUtilities.ValidateRequestReplyResponse(HttpWebRequest request, HttpWebResponse response, HttpChannelFactory factory, WebException responseException, ChannelBinding channelBinding)

Extended Stack Trace

[MissingMethodException: Method not found: 'System.String System.ServiceModel.Activation.Iis7Helper.ExtendedProtectionDotlessSpnNotEnabledThrowHelper(System.Object)'.]
System.ServiceModel.WasHosting.WebConfigurationManagerWrapper.BuildExtendedProtectionPolicy(ExtendedProtectionTokenChecking tokenChecking, ExtendedProtectionFlags flags, List`1 spnList) +0
System.ServiceModel.WasHosting.WebConfigurationManagerWrapper.GetExtendedProtectionPolicy(ConfigurationElement element) +362
System.ServiceModel.WasHosting.MetabaseSettingsIis7V2.ProcessWindowsAuthentication(String siteName, String virtualPath, HostedServiceTransportSettings& transportSettings) +217
   System.ServiceModel.WasHosting.MetabaseSettingsIis7V2.CreateTransportSettings(String relativeVirtualPath) +137
   System.ServiceModel.Activation.MetabaseSettingsIis.GetTransportSettings(String virtualPath) +203
   System.ServiceModel.Activation.MetabaseSettingsIis.GetAuthenticationSchemes(String virtualPath) +16
   System.ServiceModel.Channels.HttpChannelListener.ApplyHostedContext(VirtualPathExtension virtualPathExtension, Boolean isMetadataListener) +62
   System.ServiceModel.Channels.HttpTransportBindingElement.BuildChannelListener(BindingContext context) +158
   System.ServiceModel.Channels.BindingContext.BuildInnerChannelListener() +98
   System.ServiceModel.Channels.MessageEncodingBindingElement.InternalBuildChannelListener(BindingContext context) +98
   System.ServiceModel.Channels.BinaryMessageEncodingBindingElement.BuildChannelListener(BindingContext context) +70
   System.ServiceModel.Channels.BindingContext.BuildInnerChannelListener() +98
   System.ServiceModel.Channels.Binding.BuildChannelListener(Uri listenUriBaseAddress, String listenUriRelativeAddress, ListenUriMode listenUriMode, BindingParameterCollection parameters) +172
   System.ServiceModel.Description.DispatcherBuilder.MaybeCreateListener(Boolean actuallyCreate, Type[] supportedChannels, Binding binding, BindingParameterCollection parameters, Uri listenUriBaseAddress, String listenUriRelativeAddress, ListenUriMode listenUriMode, ServiceThrottle throttle, IChannelListener& result, Boolean supportContextSession) +400
   System.ServiceModel.Description.DispatcherBuilder.BuildChannelListener(StuffPerListenUriInfo stuff, ServiceHostBase serviceHost, Uri listenUri, ListenUriMode listenUriMode, Boolean supportContextSession, IChannelListener& result) +1070
   System.ServiceModel.Description.DispatcherBuilder.InitializeServiceHost(ServiceDescription description, ServiceHostBase serviceHost) +2005
   System.ServiceModel.ServiceHostBase.InitializeRuntime() +60
   Microsoft.IdentityModel.Protocols.WSTrust.WSTrustServiceHost.InitializeRuntime() +408
   System.ServiceModel.ServiceHostBase.OnOpen(TimeSpan timeout) +63
   System.ServiceModel.Channels.CommunicationObject.Open(TimeSpan timeout) +560
   System.ServiceModel.HostingManager.ActivateService(String normalizedVirtualPath) +141
   System.ServiceModel.HostingManager.EnsureServiceAvailable(String normalizedVirtualPath) +683

[ServiceActivationException: The service '/SecurityTokenServiceApplication/securitytoken.svc' cannot be activated due to an exception during compilation.  The exception message is: Method not found: 'System.String System.ServiceModel.Activation.Iis7Helper.ExtendedProtectionDotlessSpnNotEnabledThrowHelper(System.Object)'..]
   System.ServiceModel.AsyncResult.End(IAsyncResult result) +460
   System.ServiceModel.Activation.HostedHttpRequestAsyncResult.End(IAsyncResult result) +471
   System.Web.AsyncEventExecutionStep.OnAsyncEventCompletion(IAsyncResult ar) +101

The issue is limited to Windows Server 2008 R2/ Windows 7 RTM machines only.

The issue occurs due to previously installed hotfixes and NOT the security update KB2756920 itself.

Recommendations

• It is recommend that you Install a newer hotfix for 3.5 SP1 like http://support.microsoft.com/kb/2637518 and then install the security update. If you have already installed the security update then simply install the above hotfix.
• Another workaround would be to upgrade the machines from Windows Server 2008 R2/Windows 7 RTM to SP1.

You do not have to uninstall the security update as one of the above options will suffice the need.

MS13-004: Description of the security update for the .NET Framework 3.5.1 on Windows 7 and Windows Server 2008 R2: January 8, 2013

UPDATE

The issue caused by the update KB2756920 - Security update for the .NET Framework 3.5.1 on Windows 7 and Windows Server 2008 R2 RTM and its solution has been documented in KB2801728 - WCF services that are hosted on IIS on Windows 7 or Windows Server 2008 R2 may receive an exception error message after you install an update for the .NET Framework 3.5 SP1 for WCF for reference.

The cause section of the KB has been updated with:

This problem occurs because the computer may have some hotfixes installed that contained only "System.ServiceModel.dll" and not "System.ServiceModel.WasHosting.dll". See the "More Information" section of the KB for a list of hotfixes that are known to contain only these files.

Also see http://social.technet.microsoft.com/forums/en-US/sharepointadminprevious/thread/903d0e22-6419-48c5-8669-a1191c841b76

The KB 931125 package that was posted to Windows Update and WSUS on December 11, 2012, was intended only for client SKUs. However, the package was also offered for server SKUs. Because some customers reported issues after they installed the package on servers, the KB 931125 updates for server SKUs were expired from Windows Update and WSUS. We recommend that you sync your WSUS server and approve the expiry.

Symptoms include:

• Clients cannot login to Wireless networks that use IAS or NPS to authenticate users
• VPN users cannot connect to Microsoft VPN servers or VPN servers that authenticate to IAS or NPS servers
• Kerberos login failures
• Exchange or Lync server problems with TLS
• You may see symptoms described in KB 933430 or 2464556

If you have already applied the update on a server and are encountering issues, you should use the Fix It solution in the following article in the Microsoft Knowledge Base:

2801679 -  SSL/TLS communication problems after you install KB 931125

Let’s say that you install PowerShell 3.0 by by installing the Windows Management Framework (WMF) 3.0 from

• Description of Windows Management Framework 3.0 for Windows 7 SP1 and Windows Server 2008 R2 SP1 http://support.microsoft.com/kb/2506143
• Description of Windows Management Framework 3.0 for Windows Server 2008 SP2 http://support.microsoft.com/kb/2506146

However, after you install WMF 3.0 and PowerShell, you may receive one or both of the following error messages when you start SharePoint 2010 Management Shell:

1. The local farm is not accessible. Cmdlets with FeatureDependencyId are not registered.
2. A PlatformNotSupportedException occurred while trying to acquire the local farm: System.PlatformNotSupportedException: Microsoft 
   SharePoint is not supported with version 4.0.30319.586 of the Microsoft .Net Runtime.
   at Microsoft.SharePoint.Administration.SPConfigurationDatabase.get_Farm() at Microsoft.SharePoint.Administration.SPFarm.FindLocal(SPFarm& farm, Boolean& isJoined)

Cause

How do you get around it:

• Type "PowerShell -v 2" (without quotes). This loads PowerShell version 2, and you should be able to use it for SharePoint. Just type 'Exit' to get back to PowerShell v3
• Add '-version 2.0' parameter when executing PowerShell 3.0, and SharePoint integration should work.
• Change the Target field value for SharePoint 2010 Management Shell to the following:

C:\Windows\System32\WindowsPowerShell\v1.0\PowerShell.exe -Version 2.0 -NoExit " & ' C:\Program Files\Common Files\Microsoft Shared\Web Server Extensions\14\CONFIG\POWERSHELL\Registration\\SharePoint.ps1 ' "

See KB 2796733

Note: This is not an issue with Windows PowerShell. This is an issue with the SharePoint 2010 compatibility with PowerShell 3.0.