Our elementary used the same system polarbear describes; no one got a 4 until the end of the year because the system measured the curriculum for the entire year, and "some concepts had not yet been introduced, so could not yet be assessed."

Also, like polarbear's experience, the report cards had nothing to do with what was actually going on work-wise in the classroom. We basically ignored them through all of elementary. We used to consider them tools for the benefit of record keeping, necessary for the teachers and school but of no practical use to us.

And yes, it is a huge relief to get to the point in school where they are evaluated on the work they actually do.