The FAQ description is vague because WGT don't give away their calculation method. Despite of that, the basics are well-known.
Two numbers, the average and a rounds counter, are reset at each tier change. From there, a certain number of the best scores in that tier counts towards the average. This will be floating until that number ("saturation") is reached, furtheron it may only drop (or stay constant). Basically, two conditions must be met to tier up: Play at least that number of scores (40 for a Master) AND drop the average to a certain number (63.00 as a Master). In addition, credit wins and some match play wins accelerate the tiering process.
BushcraftOnFire: it says that your average isn't affected by a higher score than average,
It says,
completing a bad round will not negatively impact your Average Score or Tier.
which is true in the long run. Of course, a high score will raise the average in the floating phase, but after saturation, a score above average may cause it to drop:
Non-linear maths.