The latest update to Macromedia Flash MX 2004; Version 7.2 (Ellipsis) adds new file I/O capabilities to the JavaScript API (JSAPI). The shared library installed with the Flash MX 2004 7.2 Updater exposes a new FLfile object to JavaScript Flash (JSFL). This object contains 14 new functions that enable Flash developers to write Flash extensions that can access, modify, and remove files and folders on the local file system.
I was asked by Macromedia to write the documentation for the File API. You can view the reference in the form of an article, online here. (BTW: Checkout my piccie - *lol*)