Rob, the picture has to be loaded on a server somewhere and if you know the address of the picture you put the link inside this code using the words img at the front and /img at the end. You also have to insert the words img and /img in [brackets]
Also if you look to the left of the message box you will see a link to the Forum Code. Click there to see the instructions.
Step 1 as Copper Catcher says is to find a site that host pictures. This applies to being able to post pictures and just about any forum on the web. There are many sites and many are free.