There are other posts on this, but basically it's a selection course for getting into the Royal Navy as a Rating. They will check your fitness (Swim, run and gym tests), they will check your attitude towards Naval service, discipline and military life. They will see how you mix with others, check to see if your are self-sufficent enough to deal with being away form family/friends. It is a pass or fail course, fail and you will be given another chance (normally in 3 months) if they think you can change what's wrong.
All candidates joining between now and Dec 2011, it's a madatory course, but not pass/fail. All candidates joining after the end of 2011, it is a must attend and pass, otherwise lose out on your entry date.