These (localToGlobal and globalToLocal) are very useful methods that might be not as well known as they should. As now I’m a blogger, and I just wrote code using it, I took some time to draw a (I think) very didactid image about it. There’s no source, no code. Just read the figue and you should be able to understand.
And a warning: there are other pair of methods in Flex (globalToContent and contentToGlobal), which are intended to be used when your containers have borders.
Check also this amazing link: http://rjria.blogspot.com/2008/05/localtoglobal-vs-contenttoglobal-in.html
Enjoy.

And here we have another example:





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