I think it is just a software offset. The focus system always hits the same point, so adding a small offset will re-set the lens so that it is at focus at the *sensor*, not the focus chip.
This is from the EOS 1D mkIII white paper:
AF precision is adjusted for the camera and lens to fall within
the lens' maximum aperture's depth of focus. However, there
are users who want to adjust it more minutely. They have
had to go to a Canon Service Center to have it done.
AF micro-adjustment is a feature developed for these users.
The user himself can now finely adjust the AF focusing
position. The adjustment range is ±20 steps in front of (-) or behind (+) the point of focus.
C.Fn III -8-1
C.Fn III -8-2
: Selected AF point : Expansion points
V. INCOMPARABLE EOS AUTOFOCUS, NOW EVEN BETTER 22
The adjustment increment of one step differs depending
on the maximum aperture of the lens. You should
shoot, check the focus, and adjust it. Repeat this
procedure to adjust the point of focus. When a lens
registered with a point-of-focus adjustment is
attached, the point of focus will be automatically
shifted by the correction amount set.
If you set 1 (Adjust all lenses by the same amount) or
2 (Adjust by lens) and press the INFO button, the
adjustment screen will appear. The focus shift amount
per step is calculated by multiplying the maximum
aperture's single-side depth of focus by 1/8. If 1 is
set, the focus shift amount will always be the same
number of steps (but the actual amount will vary
according to maximum aperture) for all lenses. If 2
is set, the focus shift amount will change for each
different lens. You can register the focusing shift
amount for up to 20 lenses. Then, when you use one
of the registered lenses, the focus will shift by the
Note that since the camera does not recognize the unique ID of the lens, the same shift
amount will be applied to the same lens model even if it has a different serial number.
In the case of zoom lenses which have variable maximum apertures, the focus shift
amount is technically different at the wide-angle end and telephoto end. However, since
the focus shift amount cannot be adjusted individually for the wide and telephoto ends
(there is only one shift amount per lens), adjusting it for the telephoto end is better. If
an extender can be attached, the camera recognizes whether it is 1.4x or 2x and makes
a different shift adjustment from when no extender is attached. When an extender is
attached, the adjustment screen will display the lens name and extender name. To delete
the registered lens settings, select 1 or 2, then press the Erase button. All the registered
AF micro-adjustment settings will be cleared.