Nick,
Right-ee-o, Surf City USA. Is this the only place where this is done? I'll add some more of their oddities for the other guys.
1.Appliances hardwired (GD, DW, etc). Disco means mounted where you'd normally put your recp.
2.PVC outdoors(or EMT, GRC painted with $60 per gallon marine paint) Go down the street a couple of blocks to Newport Beach, and they'll lynch you for using PVC on the roof.
3. 2x4 fluorescents in T-bar, 4 support wires to structure, 4 screws to grid. Downlights in T-bar 2 wires to structure, 4 screws.

Steve,
The process is to remove the grounding connection from the service neutral (I had a hot service, so was allowed to remove the neutral feeder conductors from their lugs in the panels, on a resi service, you take all the branch circuit neuts off and test them individually)
A continuity check is then taken from the neutral bar (or branch circ cond) to ground. You shouldn't have continuity. If you do, there is a fault someplace (screw through cable, etc). It would show up on an ungrounded conductor by a tripped C/B, but on a neutral, would never be found without this test. Seems like a real good idea to me.
I just have never heard of it elsewhere
(HB once had an inspector that thought "outside the box")