Precision boosts both the to hit chance and the chance of the effect landing.
So for example, an AoE stun will usually be 90% accuracy (chance to hit) and 'may stun', which is 100% effect. Assume the targets all have Bulwark, and the attacker has Precision.
The 90% accuracy hit becomes 135% (90% increased by 50%) so the attack hits all targets.
The effect check of 100% is reduced by Bulwark to 50%, then increased by Precision to 75% (50% increased by 50%).