In settings > contacts what is the purpose of "show groups in contact list"

In my setup, i see no difference regardless of the setting, and am wondering what it is supposed to do. Found my way to it because I was hoping to be able to turn off the display of “group” labels in the contacts list - which I find very distracting.
emclient-contacts-2

Groups will be visible in some sort options.

So for example, when sorted by tag, you can see the tag groups Business, Home, Personal, etc. You can also see I have collapsed the Unsorted group, whereas the others are expanded:

If I unselect the option to show groups in contacts, it will look like this:

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