How does "Ghosting" work?

mNetFlags.set( Ghostable | ScopeAlways );

enum NetFlags
   {
      IsGhost           =  BIT(1),   ///< This is a ghost.
      ScopeAlways       =  BIT(6),  ///< Object always ghosts to clients.
      ScopeLocal        =  BIT(7),  ///< Ghost only to local client.
      Ghostable         =  BIT(8),  ///< Set if this object CAN ghost.

      MaxNetFlagBit     =  15
   };

void ShapeBase::onCameraScopeQuery(NetConnection *cr, CameraScopeQuery * query)
{
   // update the camera query
   query->camera = this;
   // bool grabEye = true;
   if(GameConnection * con = dynamic_cast<GameConnection*>(cr))
   {
      // get the fov from the connection (in deg)
      F32 fov;
      if (con->getControlCameraFov(&fov))
      {
         query->fov = mDegToRad(fov/2);
         query->sinFov = mSin(query->fov);
         query->cosFov = mCos(query->fov);
      }
   }

   // use eye rather than camera transform (good enough and faster)
   MatrixF eyeTransform;
   getEyeTransform(&eyeTransform);
   eyeTransform.getColumn(3, &query->pos);
   eyeTransform.getColumn(1, &query->orientation);

   // Get the visible distance.
   query->visibleDistance = gServerSceneGraph->getVisibleDistance();

   // First, we are certainly in scope, and whatever we're riding is too...
   cr->objectInScope(this);
   if (isMounted())
      cr->objectInScope(mMount.object);

   if (mSceneManager == NULL)
   {
      // Scope everything...
      gServerContainer.findObjects(0xFFFFFFFF,scopeCallback,cr);
      return;
   }

   // update the scenemanager
   mSceneManager->scopeScene(query->pos, query->visibleDistance, cr);

   // let the (game)connection do some scoping of its own (commandermap...)
   cr->doneScopingScene();
}