There is nothing to worry about. Either 207 or 204 is great scores for K or 1st graders, and adults should not over-analyze the numbers. The 'going down' is called fluctuation. The official report you get gives you a range. Some typical reasons are:
1. Any test scores are should be viewed as a kind of statistical average. So it serves as a guideline, but should not be exacted on a single person;
2. The questions were picked up by computers. So the questions may have more words that he didn't know this year or something. Also, the computer knows him after his first test last year, so it may started with harder questions, and worked backwards;
3. Young children may have worked more attentively last year, since it was his first time. Since he did so well, he may have rushed himself this year, or any other factors.
You will never know what actually happened -- Mr. Heisenberg said so. :-)
