Virtual Roots allow you to run "a phorum inside a phorum". It makes the selected folder to the "root folder" of all forums and folders below it which means that the "forum-list" links go as far up as to this folder and searches for "all forums" are limited to forums in this virtual root. The announcement-module has also functions to use a different forum per virtual root for the announcements. On the other hand, the administration-page is about all the forums/folders and users are valid about all forums (in all virtual roots) in the installation.