How does 'Enforce Only for Existing Approvals' work?

Process Template>Work Item>Required Approvals>Precondition

We expected "Enforce Only for Existing Approvals' flag to mean:
1) if there is an approval defined for the work item, approval is required to transition the state
2) if no approval is defined for the work item, approval is not required.

What we are seeing (RTC3.x)
1) If there is an approval defined, and the "Enforce Only" flag is set, that the state can be transition without being approved.
2) Take off the flag, and approval is required before transition.

What are missing here?

thanks