It's as accurate as it can be given your car's sensors. If you spin your tires it makes the quarter mile come sooner (since it's tracking distance by how far your wheels move) and thus your time is faster but the trap speed would be slower. It's nearly 100% accurate if you launch with no wheel spin to what the track would record on the same run.
To record you have to be stopped so you can't be rolling a few MPH since it'd know.