Explanation/Reference:
Synchronous dynamic password tokens:
- The token generates a new password value at fixed time intervals (this password could be the time of day encrypted with a secret key).
- the unique password is entered into a system or workstation along with an owner's PIN.
- The authentication entity in a system or workstation knows an owner's secret key and PIN, and the entity verifies that the entered password is valid and that it was entered during the valid time window.
Source: KRUTZ, Ronald L. & VINES, Russel D., The CISSP Prep Guide: Mastering the Ten Domains of Computer Security, 2001, John Wiley & Sons, Page 37.