You can digitally sign a document for many of the same reasons why you might place a handwritten signature on a paper document. A digital signature is used to help authenticate the identity of the creator of digital information — such as documents, e-mail messages, and macros — by using cryptographic algorithms.
Digital signatures are based on digital certificates. Digital certificates are verifiers of identity issued by a trusted third party, which is known as a Certification Authority (CA). This works similarly to the use of
standard identity documents in a non-electronic environment. For example, a trusted third party such as a government entity or employer issues identity documents — such as driver’s licenses, passports and
employee ID cards — on which others rely to verify that a person is whom he or she claims to be.
Digital certificates can be issued by CAs within an organization, such as a Windows Server 2003 server that is running Windows Certificate Services, or a public CA, such as VeriSign or Thawed.