Error All mandatory class categories have not been classified

I have enabled Project Workflow approval and assigned the mandatory class categories to Project template & Project at Classifications options, when I am changing the Project template status to Approved , system is throwing the Error message 'All mandatory class categories have not been classified. Cause: All mandatory class categories must be classified before this project can be authorized. Action: Please enter class code(s) for each mandatory class category.'

please assist is there any setups missing or what's the issue here

thanks