What is the benefit of a lens shroud and under what circumstances is it beneficial?

I have a Nikon D80, am shooting with a Nikkor 18-135mm lens and it came with a shroud. I haven't ever used it, but I'm curious what it's supposed to be used for.

It is designed to keep the sun off of your lens. My policy is never leave home without it. When the sun hits the front of your lens it lights up the glass and robs the quality of your photo.

Angled light is far more of a nuisance that light coming straight in. As light enters at certain angles it can scatter and reflect more off either the glass elements them selves or in cheaper lenses, the insides of the lens if not blackened well enuf.
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Many manufactures do not blacken the actual edge of the lenses before assembling them in their cells. Light can reflect off this area as well and the more elements in a lens, the better the chance of glare or flare.
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All this is done in and for - contrast. You want crisp sharp and clean colors and you know what a car's dirty windshield is like in sun light, especially from the right angles.
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Hoods are designed to keep the stray side light out at angles the lens manufacture know are the worse and ARE good to have on at all times. They also offer as a guard or bumper if the front of the lens hits something. While aftermarket hoods are better than none, many lenses now have "butterfly" shaped hoods because the lens now go from very wide to medium telephoto and a total circular hood will cut off the corners of the image when at the wide setting.

Blocks intruding light from certain angles. It will make pics shot in high sunlight appear clearer, more sharp, less distraction from the sun. Not quite like a filter, but it does take harsh light out.