Your child is not expected to have mastered reading by first grade, but he should be able to both recognize and make the sound of each letter in the alphabet. He should be able to recognize basic words, like "cat" or "go," and have a reasonable grasp of how to pronounce unfamiliar simple words by "sounding it out." He should be speaking in complete, intelligible sentences with language appropriate for whomever he is addressing. His average reading speed should be between 40 and 60 age-appropriate words per minute. He should understand what he is reading and answer basic questions about the reading. For example, if he reads a story about a boy who lost his dog, he should be able to answer "sad" or "unhappy" to the question "How does the boy feel?"
By the end of kindergarten, children should be able to form both upper- and lowercase versions of all the letters, spell their first name and most of their last name and simple three-letter words such as "bat." New first-graders should be well on the way to leaving "invented" spelling behind and be able to remember correct spellings of common and important words, such as the name of their street. They should also know how to write legibly (within reason) and recognize that big spaces between words are inappropriate.
Good social skills will be a crucial part of your child's development in first grade. By kindergarten's close, she should know what words are not nice to use when talking about someone else (fat, stupid, lazy, etc.) and understand the need for friends and kindness. She should know that others have feelings and that she cannot be first all the time. She should have a basic understanding of what it means to be a good friend and recognize that things are more fun when you have friends and are nice to people.
Ex-kindergartners should know how to sit still and listen for at least 10 minutes at a time. They should know generally when to be quiet (when the teacher is talking) and when to speak (at recess or when the teacher says it is OK to talk). Because first grade brings quite a lot more independence, a child who has completed kindergarten should be able to undress herself to use the toilet, tie her shoes and wash her hands properly. She should know to throw trash away, to obey the teacher and to tell an adult when she has a problem.