It relies on people's honesty Gee.  We are a group of less than 20 people, it is obvious if anyone is unusually absent and it is obvious if the work doesn't get done.  In terms of keeping in touch if we are late arriving etc we are all technically geeky types with iPhones, mobile e-mail, mobile internet and we talk to one another.

There are no core hours for our Group.  In actual fact many of the group work more than the standard hours and not less.  Sickness and holiday absence is recorded by people self reporting. 

Most of the output of the Group is through Webservices which need to be available 365/24/7 - the boss has to know if anyone is to be away to ensure there is alternative support available.  It is a matter of both individual pride and group reputation for this to work.

I am an administrator but if I worked fixed and inflexible hours it wouldn't service the flexible group of people I support.  Equally none of us - including me - have to be sat in the same location for us to function - our world is online, accessible 24 hours per day from anywhere with a half decent computer ...

This wouldn't suit someone who finds it hard to switch off - it could become all consuming.  But then as well as working hard (but flexibly) we play quite hard together too so that protects most from the temptation to do just another few hours.  It wouldn't suit everyone but I love it