When configuring Microsoft 365 mail for Change Auditor coordinator alerts and reports, and selecting to create a new web application, the web app creation will fail if the specified global administrator account does not have a licensed Microsoft 365 enabled mailbox.
This occurs because after creating the web app, permissions are added to the web app and a check is performed on the specified global administrator's mailbox using Graph API get-folders command.
Ensure the global admin account used for the automatic web app creation has a licensed M365 enabled mailbox.