Modified Date shows you when a modified record was last changed and by whom.
This information is for reference and is by no means 100% accurate. For example, a Customer can be changed by invoicing (changes their Balance), or by Import (a batch change to Credit Limits), or by Update (the magic wand to reassign Terms, perhaps).
Modified Date shows the last time someone edited the record directly, such as by entering a new address on a Customer--what engineering likes to call a "sanity check". It is incredibly useful in Searches, like Customers or Items, to see what changed lately.
Last Modified is part of the Audit feature found in Employee Prefs and displays Created Date and Created By or Modified Date and Modified By, if the record has been modified.
Big Business 14.53 resizes the Last Modified entry slightly to fit new System Fonts.