In-class differentiation is a false utopian myth, in most cases. It is far more effective to group school children by ability in separate classrooms, and teach to each group's level.
That said, you may not know everyone's true ability level (e.g. entering kindergarten, if if tested). School's need to figure out how to create an environment where a child can reach their potential, even if they're not sure what their potential is.
The problem with this is that schools will group by performance not ability and often by the weakest skill. So your gifted child could still end up in the wrong class due to not writing fast enough to complete the test or not being good at creative writing or group work. I would prefer they grouped by subject and need rather than the results of one test as often happened when I was a kid.
