Answer:
First of all, the hadeeth is found in Saheeh Muslim. The correct stance with regard to its meaning is to take it in its literal sense. And it is the memorization of the Book of Allaah and proficiency in reciting it, contrary to what some people believe it to mean, such as understanding it, even though there is no recitation and memorization.
What directs us to this understanding is the hadeeth [in Saheeh Al-Bukhaaree] of the young companion 'Amr Ibn Salimah, who was the Imaam for his people in spite of him being the youngest amongst them. This was because he was the one who had memorized the most from the Book of Allaah amongst them. And there is not mentioned in this hadeeth what indicates something else by which this companion became distinguished, other than the recitation and the memorization, without the mention of understanding it.
This is especially the case since, commonly, it is very rare for the one who has memorized the most to not be from among those who possess understanding of it, let alone be from those ignorant of Fiqh. And this is quite clear, all praise be to Allaah.
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