Let’s assume the local magnetic declination is 10 degrees east of true north (a positive declination). Therefore, the needle always points to 10 degrees. Let’s also assume that although you don’t know what direction you’re facing, it coincidentally happens to be true north. If you rotate the dial until the red magnetic needle overlays the orienting arrow (implying, "What direction am I facing?"), the reading at the index line will be 350 degrees; you must add 10 degrees to the 350 to determine the true direction you are facing. Conversely, if you dial zero on the compass (implying "What direction should I face to be pointed toward true north?"), then rotate your body and compass together in one motion until the red magnetic needle overlays the orienting arrow, the direction you'll face is 10 degrees, even though zero is dialed at the index line. You must subtract 10 degrees by turning the dial clockwise to a reading of 350 degrees, and then rotate your body & compass again until the red magnetic needle overlays the orienting arrow.
If you're in an area where magnetic declination is positive, here's an easy way to remember:
WHAT DIRECTION AM I FACING? A = ADD
WHAT DIRECTION SHOULD I FACE? S = SUBTRACT