A neurological examination evaluates the functioning of the nervous system and is divided into eight components: mental status, cranial nerves, motor examination, sensory examination, coordination, reflexes, and gait. It assesses various aspects such as sensation, motor skills, reflexes, coordination, and cognitive functioning to determine if there is any impairment or disease present in the nervous system. The exam involves testing various cranial nerves, motor strength, sensory perception, coordination, and reflexes through activities like following commands, distinguishing sensory stimuli, and evaluating gait. The goal is to localize any issues and understand the nature of any neurological abnormalities.