More specifically, you are signing the return under penalty of perjury, "based on all information of which preparer has any knowledge."  I don't know what you would find in the client's records that would help make this determination.   Maybe if his ledger sheets had a heading of "MY HOBBY" on each page.  An IRS auditor is not going to decide whether it is a hobby or business, just by looking at the records.  An auditor is going to ask the taxpayer to explain where there is a profit motive and expectation.  You should do the same.