Your miner doesn't send any information about it's actual hashrate to the pool. It only sends shares that it found. A share is the term for a proof-of-work unit your miner creates with difficulty of 1 instead of the full difficulty.
On average, a "share" is found by a miner and sent to a pool every 4,294,967,296 hashes. At your hashrate, you only send a share every 61 seconds on average, but this is variable - it could take 15 seconds for one, and four minutes for the next. Pools can only guess what your actual hashrate is, and their estimations start working better if you have about 10x that hash power.
Pools don't receive a report of miner hashrate, they get difficulty 1 share submissions and must extrapolate what the miner hashrate may be.
The average number of hashes required to find a difficulty one share is:
2**48 / 65535
so we estimate 4,295,032,833 hashes performed by a miner per share submitted.
Then lets estimate a miner's hashrate for the last 10 minutes (600 seconds):
S Shares/600 seconds * 4,295 MHash/share = S (4295/600) MHash/second = S * 7.158388 Mhash/s,
so if a miner finds 60 shares in this 10 minutes, their estimated hashrate is 429.5 Mhash/s.
