The flat file to be read in by the adapter must be available to the application server (or all application servers, if running a cluster) on a local hard drive, network share, or mounted drive, depending on the platform. If synchronization logging is configured, the log directory must also be visible to the application server(s) and writable by the account under which the application server process is running.
The most reliable configuration (and recommended practice) is to store the flat file on a drive that is local to the application server. The log file should also be written to a local directory. If using multiple Identity Manager instances on different servers, choose one server on which to run the flat file Active Sync adapter, and specify that server on the Synchronization policy page of the Administration Interface. Setting this property will ensure that the polling operation on the adapter will always run on one or more particular servers.