Final answer:
The phrase 'by the book' refers to doing things strictly according to the rules, which is essential in industries where audits are frequent to ensure compliance.
Step-by-step explanation:
When discussing the necessity of doing things 'by the book' in the context of frequent audits within an industry, the best choice from the given options would be D) According to the rules.
This phrase directly refers to following set guidelines, procedures, or regulations strictly, which is crucial in environments where audits are common to ensure compliance and avoid penalties. In the business realm, adherence to rules is a staple for good practice, particularly in industries that are heavily regulated or scrutinized.