Hi Sanmeet,
A different way of saying this is: "This cookie determines whether someone gets tracked or not" although it is more involved than that.
You can view more documentation on it here:
https://microsite.omniture.com/t2/help/en_US/dtm/#Web_Properties
and here:
https://microsite.omniture.com/t2/help/en_US/dtm/#General
This will affect how EU compliance works on all your tools. If that cookie is set on the user's browser, the tools that have EU compliance checked will not load, thereby stopping tracking from happening for that user.
The setting that you are looking at is to change the name of that cookie from it's default value which is "sat_track".