Regarding what you say, he understands (3-6)
I believe the answer is:
'regarding what you say he understands' is the definition.
The answer is a person as well as being a singular noun. This is suggested by the definition.
'you say he understands' is the wordplay.
I cannot really see how this works, but
'you' could be 'reader' (I've seen this before) and 'reader' is found in the answer.
The remaining letters 'lip' is a valid word which might be clued in a way I don't see.
This may be the basis of the clue (or it may be nonsense).
Can you help me to learn more?
(Another definition for lip-reader that I've seen is " Person interpreting from mouth movements".)