Sri Krsna, in His Paramatma feature, lives in the hearts of all living beings in both the transcendental and mundane creations. As the Paramatma, He witnesses all actions the living beings perform in all phases of time, namely past, present and future. Sri Krsna knows what the living beings have done for hundreds and thousands of past births, and He sees what they are doing now; therefore He knows the results of their present actions that will fructify in the future. As stated in the Bhagavad-gita, the entire cosmic situation is created as soon as He glances over the material energy. Nothing can exist without His superintendence. Since He sees even the abode where the collective living beings rest, He is the original Narayana.

(From Srila Prabhupada's purport to Cc Adi 2.46)