It is part of IEEE802.11v which was developed around 2010 but only recently incorporated into hostapd.
Previous thread here: Non-Broadcom router recommendations for Time Advertisement
The beacon frame from an AP always included a time variable called TSF which is the number of microseconds elapsed since the AP started. It counts up continually and every 78 days it will roll over.
802.11v adds a data tag (Information Element) to the beacon frame which pins the zero startup time of TSF as an absolute GMT time and date. So by adding these two together, any WiFi receiver in range of the AP can determine the GMT time and date. In order for this to work, the AP needs to have a correct GMT clock. Additionally, it appears that hostapd only reads the system GMT clock once on AP startup and does not correct the TSF / IE if the clock later changes.
So hostapd as it stands now has a good chance of broadcasting an incorrect time, which is worse than no time at all.