The S120 is now a fairly old watch. When the function buttons and heart rate cease to function this is generally an indicator that the battery needs to be replaced. The buttons themselves can also become worn out or weak of function, in either case you have a couple of options.
1) send in to a
Polar Authorized Service center: This is very important, do not take to a normal watch shop. You need the watch properly resealed and handled correctly as well as you may need parts such as a button return spring they will not have. Plus there is a 90day warranty on Polar's repair. You will also need to send in your chest strap just to make sure that is still functioning properly. Battery repair about $15-, new buttons another $10ish, and a chest strap if needs replacing about $25 or $30-. $50-$60 total if everything needs work, but this is just an estimate.
2) buy a new watch unit. The RS100 (the current replacement) is about $100- and is easier to use with a better chest strap.