It sounds as though the SENCO is having a look at her to decide whether or not she needs to be referred to a Speech and Language Therapist.
When you say she says 'sh' instead of 's', would you say it is the exact same sound as in the word 'ship' or is it more of a 'slushy' sound (which sounds a little like 'sh' but not really)? Sorry, I'm not making myself sound very clear here but I hope you can get what I mean...
It is quite typical for young children to say 'th' instead of 's' (e.g. 'thinging a thong' instead of 'singing a song') and is something they generally grow out of at about 4 1/2 years of age.
However, if the sound is more 'slushy' this suggests a lateral lisp which generally requires some form of speech therapy as it doesn't tend to resolve on its own. If she is saying a true 'sh' sound, she may also require some form of therapy as well as she is saying the sound further back in the mouth than she should be. Are there any other sounds she can't say properly?
Obviously, it is difficult to say what the outcome would be and the nature of your child's possible speech difficulty without assessing your child. Therefore, this will be the first thing the therapist does (if the SENCO decides to refer her!). If referred, the therapist will talk to you about your concerns and your child's early development and find out if hearing has been tested. She'll probably also do a speech assessment of some sort (perhaps the STAP - South Tyneside Assessment of Phonology) or the DEAP (Diagnostic Evaluation of Articulation and Phonology). She will probably also see if your child can copy and make the sounds with some prompting (i.e. is 'stimulable'). She may also look at how she processes sounds (i.e. can she discriminate between certain sounds). The therapist, to be thorough, will probably also screen language in some way (can she answer questions, understand instructions, generate well-formed sentences about a picture...etc) and will also be keeping an eye out for how your child interacts socially and plays.
Based on all of this, it will be decided what the best course of action is. The therapist may just send you away with some advice, she may give you some practice sheets to do to help the sounds that need working on, or she may offer you some therapy. Without doing a full assessment, it would be impossible to say which outcome is likely in your DD's case.
HTH