My app uses NSTimer and it appears that NSTimer doesn't fire when the iPhone goes into the stand-by mode (either by pressing the hardware button or by the idle timer).
When I activate the iPhone again, my app is still in the foreground. What happens to third party apps when the iPhone is the stand-by mode?
Although it's not evident here, I believe the original poster did find an answer to his question by starting a thread (available here) in the iPhone Developer Forums (which I eventually had to find myself because the information wasn't shared here).
In case someone else has the same question and finds the page in the future, here's a helpful response that was posted by someone on the Apple forum called "eskimo1" (which I have edited slightly such that it is easier to read without having the context provided by the entire original thread):