In human society graduation or status is often based on earned credits, and for this a written record is important. The record substitutes for insight, as two men standing before a third may look and talk the same, but have vastly different capabilities and accomplishments. As any employer knows, resumes can lie and the breezy, confident applicant can be well rehearsed. As any hospital knows, the intern who performs best in an emergency because of hands-on experience during school lab assignments may not be the talkative and knowledgeable intern the administrator expected to be the star. Thus, the written record in human society allows those sitting in judgment to make an appropriate decision, and for important decisions this record is well researched. Should the judge send the surly prisoner to jail for life and let the quiet, well-groomed prisoner off on probation? The judge will look at the record - how many arrests, how many convictions, the severity of the crimes, behavior and progress during incarceration, or extenuating circumstances.
Is not such a record kept on entities, on their many incarnations, on their behavior during incarnations and the choices made when the chips were down? Yes, but this record is recorded within the entity itself, as memory, and cannot be erased. Where human society cannot read such a record recorded in another's memory, and can be fooled by the visage and actions of the other, higher spiritual densities are not so fooled. As you say, we can read you like a book.