This dll is an implementation of the Windows LogonUI Credential Provider. 

LogonUI is actually the login screen Windows shows when you need to login/unlock etc. When this screen is shown, it tries to load all the registered Credential Providers. These providers help to perform different kind of "logins". For instance a credential provider is what is asks you to input your username and password. Another may use your fingerprint/pin etc. 

In our case the WACP.dll helps us perform the auto-login.