The way it's worked for me is that I've been asked to report my hours when the information is being used to track how my time was divided among different projects. The ostensible purposes were to show that each project was receiving the its allocated share of resources. A secondary purpose was to see if anybody was being overworked -- for instance it could be used as evidence to justify hiring another person.

But we were told in no uncertain terms that we were not counting our hours. I'm sure the legal department had approved all of the verbiage and procedures.

I never personally measured my work in hours, and a lot of workers simply reported hours that precisely matched their project allocations, or copy-pasted from one week to the next. My present job doesn't have any of that.