Ours is all very confusing too! Last year DS 1st Grade received grades for work he was accelerated for (Lang and Math 2nd and 3rd Grade) on a regular basis, but when it came to report time whatever he had scored just showed up as a bunch of stars since any Grade received was considered top of/beyond First Grade.
This year in the same school it seems different. Online he is shown as a 3rd Grader (although he's 2nd - his homeroom class is 2nd/3rd) and is given Grades to match third.
Not sure this post helps - probably just confuses things further!