The Gem of Kerouac, in the hands of a Lawful Good person, will do the following: allow them to detect evil at any time, give them +3 vs. CE, +2 vs. LE, and +1 vs. NE on to hit and damage.
This does not include Devils and Demons. When fighting these, the following powers are also given: +8 on saves, ability to mask the holder from the mind until attack (even if the demon or devil already saw the holder!), a -3 on AC, a + equivalent to the HD of the creature on to hit and damage, regeneration of 1-4 hp per round that was caused by the demon/devil and, if he can touch the demon/devil, send them back to their own plane for 10 years.
If any evil person touches the gem, 1/2 of their hp will be lost each round (if they had 24 hp, they would have: 12, 6, 3, 1, 0).