Selecting 'Yes' to this option will prevent students from uploading any files that are not PDFs.
If you select 'No', then students will receive a warning about non-PDF files, but will still be able to submit as long as at least one file is a PDF.
This second option may be useful if you want students to be able to submit supporting files with interactive elements still working (e.g. a spreadsheet with the formulas in it), but only the PDF files will be available for annotation.