Hopefully this will end some of the threads that seem to ask the same thing :-/
This was written by Oramin and Bloodshrike on b-net's forums. I added a few examples where I thought needed
The following things work with Smite:
Bonus damage from STR (each point of STR adds 1% ED) (new for 1.10)
+Skills (increase damage a LOT)
Crushing Blow (including CB on the weapon; e.g. Black runeword)
Weapon range (see below)
Weapon speed (see below)
Life Tap (charges can be found on wands and daggers, save this for tough spots)
Freezes Target (including from the weapon; e.g. Sureshrill Frost)
Hit Blinds Target (From all gear, including the weapon and the shield)
Slow (including from the weapon; e.g. Pompeiis Wrath)
% Chance to cast (including from the weapon)
Prevent Monster Heal
Open Wounds (new for 1.10)
The following things work with Smite but do *not* display on the Character screen:
Enhanced Damage which is off-weapon (thanks to Grimble for bringing this to my attention; thanks to Mikeandroe for helping test) (new for 1.10)
The following items increase the shield damage: Redeemer, Astreons Iron Ward, Stone Crusher, Grief runeword (Redeemer confirmed by Stopherson) (new for 1.10)
Damage +X, which is the attribute that the above items have, is added directly to the shield damage just like the Holy Shield bonus. This means that any %ED bonuses which work with Smite will apply (e.g. Fanaticism). (Thanks to Mikeandroe for helping test).
The following things do not work with Smite:
Leech (life/mana)
Deadly Strike/Critical Strike (confirmed by both Oramin and Vash-dm independently in 1.11)
Knockback (apart from the standard Knockback on the skill)
Elemental damage from equipment or charms
Elemental damage from auras (e.g. Holy Shock) (the area effect will still work, just not the applied damage)
Magic damage from Sanctuary (note that I havent verified this for 1.10+ but I dont see any reason it should have changed; the area effect will still work, just not the applied damage) (added on behalf of gibbousmoon)
Gear and charms that add a set amount of damage (verified by SSJPunk) except for those items which have the Damage +X attribute (e.g. WarTravs will *not* add damage to Smite; neither will 3/20/20 scs)
Enhanced Damage on the weapon
Enhanced Damage to Demons (e.g. Laying of Hands) (Thanks to Bonkshasa and Posterboy for testing)
Enhanced Damage to Undead has *not* been tested, but it should behave the same way as Enhanced Damage to Demons
Smite speed is dependent on:
Base weapon speed (odd but true)
% EIAS from Fanaticism
IAS in gear
6 frame Smite is the fastest possible
How is Smite Damage Calculated? Version 1.11
It behaves like a standard weapon (except the %ED on the shield isn't equivalent to %ED on a weapon).
Take the shield's base damage.
Add anything that increases the shield damage.
Multiply by non-weapon sources of %ED.
For example:
(Shield Base + Holy Shield bonus + Grief bonus) * (1 + Smite %ED bonus + STR %ED bonus + Fanaticism %ED bonus + off-weapon %ED bonus) = Total damage
The reason for this section is that the LCS (Lying Character Screen) isnt necessarily accurate. If you want to know the damage that you are actually doing you should run the numbers yourself.