Information
With macOS 10.12, Apple introduced the capability to have a user's Desktop and Documents folders automatically synchronize to the user's iCloud Drive, provided they have enough room purchased through Apple on their iCloud Drive. This capability mirrors what Microsoft is doing with the use of OneDrive and Office 365. There are concerns with using this capability.
The storage space that Apple provides for free is used by users with iCloud mail, all of a user's Photo Library created with the ever larger Multi-Pixel iPhone cameras, and all iOS Backups. Adding a synchronization capability for users who have files going back a decade or more, storage may be tight using the free 5GB provided without purchasing much larger storage capacity from Apple. Users with multiple computers running 10.12 and above with unique content on each will have issues as well.
Enterprise users may not be allowed to store Enterprise information in a third-party public cloud. In previous implementations, such as iCloud Drive or DropBox, the user selected what files were synchronized even if there were no other controls. The new feature synchronizes all files in a folder widely used to put working files.
The automatic synchronization of all files in a user's Desktop and Documents folders should be disabled.
https://derflounder.wordpress.com/2016/09/23/icloud-desktop-and-documents-in-macos-sierra-the-good-the-bad-and-the-ugly/
Rationale:
Automated Document synchronization should be planned and controlled to approved storage.
Impact:
Users will not be able to use iCloud for the automatic sync of the Desktop and Documents folders.
Solution
Graphical Method:
Perform the following steps to disable iCloud Desktop and Document syncing:
Open System Settings
Select Apple ID
Select iCloud
Select Options on iCloud Drive
Disable Desktop & Documents Folders
Profile Method:
Create or edit a configuration profile with the following information:
The PayloadType string is com.apple.applicationaccess
The key to include is allowCloudDesktopAndDocuments
The key must be set to <false/>
Note: Since the profile method sets a system-wide setting and not a user-level one, the profile method is the preferred method. It is always better to set system-wide than per user.