A file reference is created by dropping a file or folder from the Finder onto a paragraph or side column. The file is not copied to the document. Like this, very large files can be referenced without increasing the file size of the document.
A file reference can be moved by dragging the icon to another position in the same paragraph. It can be copied to a different paragraph.
The file or folder can be opened by double clicking onto the icon.

After selecting the icon a file reference can be deleted by the Edit > Delete command. Deletion is undoable.