My child's school uses the 1-4 system but the way they define the numbers is a bit different.
1 is does not meet NYS standards for ____ grade
2 meets some NYS standards for _____ grade
3 meets all NYS standards for ______ grade
4 exceeds all NYS standards for _____ grade
Each area math, science, reading, etc... Is broken down into the skills they need to achieve that year. So reading in kindergarten may be:
Recognizes all upper case letters - followed by a number.
Recognizes all lower case letters - followed by a number
Can phonetically sound all letters - followed by a number
etc...
It works for us. I like it better than the letter grades my daughter gets in 5th grade. Reading - A. Means nothing to me. Seeing it broken down by each skill they need to attain makes much more sense to me.
Hope this helps some.