A referenced entity is a parent entity. You can choose to include the fields of the referenced entity along with the fields of the primary entity in the custom schema.
Consider the following example:
You select Windows File as the primary entity to create a new asset type.
You choose to include the referenced entity fields also in the new asset type. The parent or referenced entities for the Windows File are Domain, Machine, and Group.
You create a new asset type. When you run a job that is based on the new asset type, the job also collects the information about the referenced fields.
If the data for the Windows File asset type contains information about the Domain, the import job also returns the data for the domain.