Plain English Meaning
It is the exact phrase a pilot says to clearly hand over control of the aircraft to the other pilot, so there is no doubt about who is flying.
Full Definition
A standardized verbal statement used during a positive three-step exchange of flight controls between two pilots, in which the pilot currently flying formally transfers control of the aircraft to the other pilot. It is the second step in the FAA-recommended exchange sequence: the pilot wishing to hand over control says 'You have the flight controls,' the receiving pilot replies 'I have the flight controls,' and the original pilot confirms with 'You have the flight controls.' The phrase is normally accompanied by a visual check that the other pilot has placed hands and feet on the controls.
Context Anchor
Used during flight training, dual instruction, or any flight with more than one able to control the aircraft.