When you add a new category that is the correct behavior. After you add new forums inside that category the message should disappear, correct ? The forum here: http://syltek.dingojunction.com/forum/ looks ok, btw.
Yes, once I create a forums all is fine but I had to use the 'Create New Forum' from another category and change it to the new one in the edit page. Let say there were no categories at all and I added one, if the category comes up as 'No Forums Found', how would I add a forum if the admin icon for 'Create New Forum' is not there ?