I wonder what ip_forwarding is for. So in the wiki site (http://en.wikipedia.org/wiki/Sysctl) there is some thing that explain ip_forwarding is for. The function is to enable the kernel pc (server) as a router. So another machine connected to it will be enable to use internet connection in that pc or server.
As simple as that. To check whether is enable or not just type this :
#sudo cat /proc/sys/net/ipv4/ip_forwarding
if it results 1 then it is enable. But if zero means unable.
To unable it just change the value from 0 to 1
#sudo echo 1 > /proc/sys/net/ipv4/ip_forwarding