If there's lots of telling, there is an implication is that the reader can't work it out for themselves. This might be because they are less sophisticated - an early reader, for example - or because the action is so fast paced that there simply isn't time for the reader to keep up. So thrillers tend to have a lot of telling (read Dan Brown for the proof), as do children's books.
Other times when it's good to tell:
- when you can assume the reader knows the mechanics. I've heard this described as sandwich making - you don't have to tell us that making a sandwich involves taking two slices of bread, spreading butter over one side, putting a filling such as cheese on the buttered side of one slice, then placing the other slice on top, you can just write 'she made a cheese sandwich'.
- when you want to get through time quickly. 'The next two weeks passed without the letter arriving.'
- when you want to avoid duplication. You just had a scene with Jemima telling Justin about the new zoo that's opened down the road, when James comes in. Rather than give James and Justin's actual dialogue you might write something like: 'James turned up, so Justin quickly filled him in on what Jemima had just said about the zoo.'
- what's going on is actually rather dull, so you don't want to bore the reader. 'They worked feverishly to get the house ready for the party.'
- the information needs to be there. Queen Victoria came to the throne in 1837. It's a fact, there's no need to make us play a guessing game as to the exact date, if it's important.
- you want to move the story on. If Mavis is feeling nervous, while it's generally a good idea to give her some actions that would indicate nervousness to most people - nail biting, fidgeting, sitting on the edge of her seat - you might want to get on with the story telling, in which case, just tell us that Mavis is nervous.
There are no absolute rules, so first develop, then use your instincts.