You can find this toggle under Settings -> Portfolio & Tax section. This toggle is on by default and can impact balances and reports. The situation this toggle addresses is for a transfer between two imported sources that only contains the data for one side (either the outgoing 'send' or incoming 'receive'). Situations like this can arise from limitations in the data provided, and would require addressing without the automated transfer generator. It is recommended to check over these transactions to verify their accuracy and relevance to your situation, and consult a tax professional if this is right for your circumstances.
The function this toggle provides involves the automatic generation of a missing part of a transfer where conditions are met. More information on what a transfer is can be found here. There are strict conditions that have to be met to allow this, to ensure we are only filling in data that is known to be missing:
Both the 'from' and 'to' sources have to be imported
A loose match with another transaction cannot be found
What this means is that anytime you have two sources imported, but one side of a transfer (that is a send or receive) is missing, the other side will automatically be generated, creating a Transfer and properly moving the balance from source A to source B.
In the event that the data that was missing somehow gets imported, the automatically generated section of the transfer will be removed, and the imported data will take its place as if it was never there.
When the toggle is marked as off, any transactions that had this generation applied will have it reverted. The data will be as if it was never applied in the first place. You can toggle it on again at any point and the system will attempt to find transactions that satisfy the criteria, and will apply it again. Doing this will not compromise your data.
How to identify these automatically generated transactions?
Should you desire to check the transactions that this has impacted you can do so in the Transactions page.
The transactions can be filtered for using the Other Filter - Only show smart-categorized transactions
Note: Having this filter selected can show up other smart categorized transactions also. This function impacts transfers only, and you can tell them by hovering over and seeing the tooltip as in the image below. The transactions have a visual symbol of a 4 sided star on them.
If you feel the automatic generation was not warranted, necessary or was incorrectly creating transactions, you can toggle this off and the data will revert back to the original state with no consequences.