Im trying to set up my new 5s from a icloud backup on my 4s. when i  my 4s backup is gray and i get msg: "No iCloud backups are compatible with the version of iOS (7.0.6) on this phone. 4s iOS is 7.1 with no update available

Trying to set up new 5s from icloud backup on 4s. when i select "restore from backup" the current backup on my 4s (today) is gray and cannot be selected. the msg on the bottom: "No icloud backups are compatible with the version of ios (7.0.6) on this phone. 4s ios is 7.1 with no updates available. help?

You will have to first update your new iPhone 5s to iOS 7.1 before you can use your iPhone 4s backup.
Set it up as new, do the update (Settings > General > Software Update) and then re-enter setup by erasing the phone (settings > General > Reset > Erase all Content and Settings).

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