If Sand, Red Sand or Soul Sand is used, the hourglass acts as a timer, emitting a 4-tick long redstone signal. The time between pulses depends on the block used and the amount inserted:
Whenever a Mana pulse hits the hourglass in this mode, the timer will be paused/unpaused.
If Mana Powder is used, the Hourglass acts as a counter. Each time the block is hit by a Mana burst it will count up. When the counter reaches the amount of powder stored it will emit a redstone signal and reset.
Using a Wand of the Forest on the Hourglass will lock (or unlock) it. When locked, items cannot be added or removed.
Looking at the Hourglass while holding a Wand of the Forest will show the items stored, time between pulses, and whether or not the hourglass is locked and/or paused.