Out of curiosity I was testing Guillotine Fist damage while unarmed. I wanted to know how much my Medal of Honor was effecting my overall damage.

Unarmed, I noticed that I did 76066 with the Medal of Honor. I took it off, and still did 76066.
I tried all sorts of other skills, and noticed that it was not adding attack while unarmed.

I switched to a Mechanic where I did some tests with weapon perfection, and sure enough, I was getting attack increases of about 5% with a medal of honor equipped. Without a medal of honor, with a +0 Veteran Axe, porings would take 302 damage without a medal and 310 with it.
Using a +8 pile bunker and maximum over thrust that 5% goes a long way, from doing 1350 without it to about 1410, but is still a 5% increase.

From this it becomes obvious that Medal of Honor and The Sign increase only your weapon attack by 5%.

I then tested it with magical damage. An unarmed holy light with no Medal will strike a poring for 217, and equipping a Medal increases that damage to 227, about 5%.
It seems to increase your magic attack by 5% just fine, but Heal is completely unaffected. Mystical amplification however does affect heal, with and without a weapon, but it seems to be the same range regardless if you have anything equipped.

With no bonuses (aside from Meditatio 10), I heal for 1894. Putting on an item that gives +3 int and +6% heal, I then heal for 1980. 1894 multiplied by 1.06 actually gives 2007. This piece of equipment is only adding about 4% heal efficiency, not including that +3 int that's added. Nonetheless, it adds about 100 heal.
So then healing for 1980, I equip a staff that's Matk+125 and Int+3. I heal for just about 125 more after putting it on, given the usual variance.
This leads me to believe that healing bonuses completely ignore the matk on weapons, even though that matk is supposed to be a very large part of heal.

Further testing, on my Sura, a holy light will deal 170 damage on a Creamy. Putting on The Sign, the damage is then 178.
Equipping a staff with matk+100, the holy light damage increased appropriately, but putting on The Sign produced damage outputs that were nearly identical to the weapon's original matk range without the Sign equipped at all. This leads me to believe that The Sign is only adding to your status magic attack and not weapon magic attack, but is not effecting heal whatsoever.

Basically, The Sign adds 5% Physical Weapon attack and 5% Magic Status Attack and Heal bonuses ignore the bonuses from weapon magic attack.

This all seems so dumb. Get somebody to edit the formula and just put The Sign bonus as *1.05 as the final calculation in the damage formula. As for heal, well... That should be fixed easily enough with some well-placed parentheses.