Instantaneous fuel economy - how to apply/use?

I am having a hard time understanding this parameter and how to use it in reports or how to make them useful for clients.

First, I'm not really sure what it means. The number varies too much, from message to message, so you can't get a clear picture unless you know what it is for.

In the FMS stadnard document it is stated "1/512 km/L per bit", that's how the calculation table should be set, but I'm not sure what it means.
Kilometeres that you can travel with one liter? or something else?