SQL server 2008 R2 Arithmetic overflow error converting numeric to data type numeric - sql-server-2008-r2

Question

I have a confusing error that I can not understand on SQL Server 2008 R2.
But when I try the same request on a local server (SQL Server 2008 R2 also) everything works fine.
So here is the request raising the problem:
select cast(cast(1.260 as numeric(13,3)) as numeric(10,2))
I also added the result of some queries indicating the environment of each server:
On the local server:
---------------------------------------
1.26
(1 row(s) affected)
Microsoft SQL Server 2008 R2 (RTM) - 10.50.1617.0 (X64)
Apr 22 2011 19:23:43
Copyright (c) Microsoft Corporation
Standard Edition (64-bit) on Windows NT 6.1 <X64> (Build 7601: Service Pack 1)
ARITHABORT
---------------------------------------------------------------------------------------------
1
(1 row(s) affected)
ARITHIGNORE
---------------------------------------------------------------------------------------------
NULL
(1 row(s) affected)
ANSI_WARNINGS
---------------------------------------------------------------------------------------------
1
(1 row(s) affected)
On the remote server:
Msg 8115, Level 16, State 7, Line 1
Arithmetic overflow error converting numeric to data type numeric.
Microsoft SQL Server 2008 R2 (SP1) - 10.50.2500.0 (X64)
Jun 17 2011 00:54:03
Copyright (c) Microsoft Corporation
Enterprise Edition (64-bit) on Windows NT 6.0 <X64> (Build 6002: Service Pack 2) (Hypervisor)
(1 row(s) affected)
ARITHABORT
------------------------------------------------------------------------------------------------------------
1
(1 row(s) affected)
ARITHIGNORE
------------------------------------------------------------------------------------------------------------
NULL
(1 row(s) affected)
ANSI_WARNINGS
------------------------------------------------------------------------------------------------------------
1
(1 row(s) affected)
My question is how can I reproduce the problem that is occuring on the remote server. As you can see, the parameters ARITH... and ANSI_.. are the same on both servers. Is there any configuration on that kind of errors on the SQL Server?

Answer 1

The NUMERIC_ROUNDABORT option is ON
When SET NUMERIC_ROUNDABORT is ON, an error is generated after a loss of precision occurs in an expression. When OFF, losses of precision do not generate error messages and the result is rounded to the precision of the column or variable storing the result.
Normally this is OFF because when ON indexed views etc can fail.
I've never changed this, ever.
SET NOCOUNT ON;
GO
PRINT 'ON'
set NUMERIC_ROUNDABORT ON;
select cast(cast(1.260 as numeric(13,3)) as numeric(10,2));
GO
PRINT 'OFF'
set NUMERIC_ROUNDABORT OFF;
select cast(cast(1.260 as numeric(13,3)) as numeric(10,2));
GO
gives
ON
---------------------------------------
Msg 8115, Level 16, State 7, Line 3
Arithmetic overflow error converting numeric to data type numeric.
OFF
---------------------------------------
1.26