I know that in the lower rpm ranges the cam timing is advanced and as it goes up the timing is switched over to retarded. Also I know that this is done electronicly. My question is what is exastly going on when the timing is advanced and retarded?

 

It changes the opening and closing points of the valves in relation to the piston position.
Example; valves that open early will also close early.
An advanced cam timing will keep the exhaust valves closed to a later point, holding the cylinder pressure longer for more low end torque.
As the valve timing is retarded, it favors higher rpm because of the increasing difficulty for air to flow and opeing the valves earlier to favor that airflow.
The adjustability of this timing allows the engine to display higher torque over a wider power band.
This is all based on relitive barometric air pressure that forces air into the engine as the piston goes down in it's intake stroke,
then how the air and combustion results are handled by cam timing, ignition timing and amount of fuel injected.
There a lot going on.