During iPhone update to iOS 10.3.1, I was asked for my password using the correct machine name for my Mac mini. To be clear, the request was not for my iCloud password, my actual local user account password for macOS. This can also happen in the other direction - setting up a Mac may ask for verification for you to enter your iPhone / iPad passcode (and not your iCloud password)
I could not find any information about this kind of access. I was thinking it was security for iCloud and possibly related to two step authorization or two factor authorization. This is the first time I can think of that I entered a desktop password outside of that actual desktop.
I don't have a screen shot but I recall an implication that some files in my Mac are encrypted and need my password. '... need to enter the password for .'
Are there settings I can I control this assuming it's a legitimate part of iCloud setup process or iOS setup process?