The Actionscript editor built into Flash is okay, but not great by any means. Today I went off in search of something better–much better.
For the Mac, I found JEdit which also works on the PC. With some minimal customizing, it works great. The toolbar is at the top of the screen like every other Mac app, which is great but still very uncommon for Java apps on OS X. It allows you to collapse functions to better view code and the default install has syntax highlighting for Actionscript. In addition there are numerous plugins available and it has an active development and support community.
For the PC there’s a dedicated Actionscript editor that has the Flash API and autocomplete for flash syntax built in, allows you to build and preview your file right from the interface, also lets you collapse functions and allows for retectangular selections. It’s called SEPY or SE|PY. It looks like there’s a Mac port on the way–there’s even a screenshot of it working under OS X on their site.