It's a sign of gill irritation, most external parasites will attack the gills simply because they don't have a slime coat and they are full of blood. Ammonia burns the gills and causes the same reaction from the fish. Likewise any tixin in the water that might cause ithcing or pain in the gills will induce flashing.
Additionally some fish will flash as when trying to intimidate other fish. my firemouth always does this immediatly after he wrestles with the Oscars. In this case, the flashing immediatly follows other behavior and is consistant enough that it isn't hard to seperate it from Flashing caused by other problems.
It's always a treat trying to locate the cause of Flashing. most of the time in the average tank, it's ich or ammonia. Simply because these two issues are very common. I had one guppy tank where flashing continued for nearly a year. I knew ich was not present, and knew there were not and never had been ammonia issues. many of the fish in that tank were born there. I eventually narrowed it down to gill flukes and killed them.
Fish that have had significant ammonia burn will sometimes flash for the rest of their life. This is not real common, but does happen.
If you have continual flashing I am convinced that is definately a sign of an issue, and not just normal fish behavior. I have always managed to eventually cure my fish of flashing.
Dave