A check mark in this field indicates that when handling an outbound unit of the item in question, you must always specify which existing serial number to handle. This means that when selling a unit of the item, it must be applied against a specific pool of serial numbers in inventory. Or in other words, a serial number assigned to the item when entering into inventory must follow that item type out of inventory.
As this particular setup field covers all possible transactions with the item, the individual inbound/outbound fields will also be checkmarked. However, the individual inbound/outbound fields have nothing to do with application across inventory - they merely define a company's work flow concerning when to assign item tracking numbers.
Note: If the item costing method is specific, this field must contain a check mark. If you use a different item costing method, this field is optional.