The problem is not that attendances are timestamped in utc (all the times are timestamped in utc in OpenERP) but the fact that OpenERP developers have not realized on which things this kind of forcing openERP to use utc time in database affects. Because timezone problems are like ripples, first they look really small and irrelevant but they grow bigger and bigger...

Anyway, here is temporary solution for your problem however like I said timezone problems are like ripples and you may encounter them in future in many places where you are not expecting them so be prepared for that. And as I don't use timesheets myself I didn't test this totally I just checked that the problem you described doesn't appear anymore. I.e., I made this fix just out of curiosity not because it would help me so test it properly.

And remember, this trick is just what it is: a trick which makes it look like the problem is solved but it isn't fully solved. So this solution is like a painkiller it removes the pain but doesn't remove the reason for the pain.

1. Remove all you attendance data (old data is not updated so they will still appear on the wrong sheet even after this modification so you have to remove it).

2. Open file [path to your openerp addons]/hr_timesheet_sheet/hr_timesheet_sheet.py It would be better to do your own module, that inherits from existing implementation, for this because as you update your OpenERP all these changes done directly to the source code will vanish.

In the beginning of file add:

import pytz

pytz is a python module for handling timezones. Then go to line 367 (this is in class hr_attendance in function _sheet)

there is for loop looking like this:

for attendance in self.browse(cursor, user, ids, context=context):
        date_to = datetime.strftime(datetime.strptime(attendance.name[0:10], '%Y-%m-%d'), '%Y-%m-%d %H:%M:%S')
        sheet_ids = sheet_obj.search(cursor, user,
            [('date_to', '>=', date_to), ('date_from', '<=', attendance.name),
             ('employee_id', '=', attendance.employee_id.id)],
            context=context)
        if sheet_ids:
            # [0] because only one sheet possible for an employee between 2 dates
            res[attendance.id] = sheet_obj.name_get(cursor, user, sheet_ids, context=context)[0]

add these line to this loop

        cursor.execute("select rp.tz as tz from res_partner as rp, res_users as ru where ru.id=%s  and ru.partner_id=rp.id", (user,))
        tz = cursor.dictfetchall()
        tz = pytz.timezone(tz[0]['tz']) or pytz.utc

        DATETIME_FORMAT = "%Y-%m-%d %H:%M:%S"
        date_from = pytz.utc.localize(datetime.strptime(attendance.name, DATETIME_FORMAT)).astimezone(tz)
        date_to = pytz.utc.localize(datetime.strptime(date_to, DATETIME_FORMAT)).astimezone(tz)

So the final version of this for loop looks like this

for attendance in self.browse(cursor, user, ids, context=context):
        date_to = datetime.strftime(datetime.strptime(attendance.name[0:10], '%Y-%m-%d'), '%Y-%m-%d %H:%M:%S')

        cursor.execute("select rp.tz as tz from res_partner as rp, res_users as ru where ru.id=%s  and ru.partner_id=rp.id", (user,))
        tz = cursor.dictfetchall()
        tz = pytz.timezone(tz[0]['tz']) or pytz.utc

        DATETIME_FORMAT = "%Y-%m-%d %H:%M:%S"
        date_from = pytz.utc.localize(datetime.strptime(attendance.name, DATETIME_FORMAT)).astimezone(tz)
        date_to = pytz.utc.localize(datetime.strptime(date_to, DATETIME_FORMAT)).astimezone(tz)

        sheet_ids = sheet_obj.search(cursor, user,
            [('date_to', '>=', date_to), ('date_from', '<=', date_from),
             ('employee_id', '=', attendance.employee_id.id)],
            context=context)
        if sheet_ids:
            # [0] because only one sheet possible for an employee between 2 dates                                                                        
            res[attendance.id] = sheet_obj.name_get(cursor, user, sheet_ids, context=context)[0]

NOTE: in python indentation matters so copy pasting this to your code may cause indentation failures so be sure that indentation are right (I'm not sure how much you have experience about python so thought that this is good to mention).

3.Restart your openERP server with parameter -u hr_timesheet_sheet so that hr_timesheet_sheet module is updated.

my file is different from urs, i cant find (for attendance in self.browse(cursor, user, ids, context=context):
......) . im using openerp v7.0