The lord was sitting on a mattress of straw because such a sitting place is accepted by persons who are practicing austerities to gain understanding of the Absolute Truth. In this verse it is specifically mentioned that he was speaking to the great sage Narada, a celebrated devotee. Narada was asking Lord Siva about devotional service, and Siva, being the topmost Vaisnava, was instructing him. ln other words, Lord Siva and Narada were discussing the knowledge of the Veda, but it is to be understood that the subject matter was devotional service. Another point in this connection is that Lord Siva is the supreme instructor and the great sage Narada is the supreme audience. Therefore, the supreme subject matter of Vedic knowledge is bhakti, or devotional service.