From a logging perspective, there is a time when an event happens. The timestamp for that should be absolute. Then there's the interaction with the viewer of the event, the person looking at the log, and where he is. If the timestamp is absolute, the event can be translated to the viewer at his local time. If the event happens in a a different TZ, for example a sysadmin sitting in PST looking at a box at EST, it's easier to translate the sysadmin TZ env, and any other sysadmin's TZ anywhere in the world, than to fiddle with the timestamp of the original event. It's a minor irritation if you run your server in UTC, and you had to add or subtract the offset, eg. if you want your cron to run at 6PM EDT, you have to write the cron for 0 22 * * *. You also had to do this mental arithmetic when you look at your local system logs, activities at 22:00:00 seem suspicious, but are they really? Avoid the headaches and set all your systems to UTC, and throw the logs into a tool that does the time translation for you.

The server does not "know" anything about the time, that is, it's really about the sysadmin knowing what happened and when.