Each router has a match() method which is responsible for associating a URL to controller action.

In the standard router, match() method breaks the request path info into 3 parts by slash.
First part is used to get module name
Second is for controller and third is for action.

Based on this the standard router is able to associate a url to controller action.

class Mage_Core_Controller_Varien_Router_Standard extends Mage_Core_Controller_Varien_Router_Abstract
{
    protected $_modules = array();
    protected $_routes = array();
    protected $_dispatchData = array();

    public function collectRoutes($configArea, $useRouterName)
    {
        $routers = array();
        $routersConfigNode = Mage::getConfig()->getNode($configArea.'/routers');
        if($routersConfigNode) {
            $routers = $routersConfigNode->children();
        }
        foreach ($routers as $routerName=>$routerConfig) {
            $use = (string)$routerConfig->use;
            if ($use == $useRouterName) {
                $modules = array((string)$routerConfig->args->module);
                if ($routerConfig->args->modules) {
                    foreach ($routerConfig->args->modules->children() as $customModule) {
                        if ((string)$customModule) {
                            if ($before = $customModule->getAttribute('before')) {
                                $position = array_search($before, $modules);
                                if ($position === false) {
                                    $position = 0;
                                }
                                array_splice($modules, $position, 0, (string)$customModule);
                            } elseif ($after = $customModule->getAttribute('after')) {
                                $position = array_search($after, $modules);
                                if ($position === false) {
                                    $position = count($modules);
                                }
                                array_splice($modules, $position+1, 0, (string)$customModule);
                            } else {
                                $modules[] = (string)$customModule;
                            }
                        }
                    }
                }

                $frontName = (string)$routerConfig->args->frontName;
                $this->addModule($frontName, $modules, $routerName);
            }
        }
    }