Understanding the Language of Excel Formulas and Functions

Learning a new language has never been this easy. 

Over the years I’ve become well versed in the language of Excel – building spreadsheets, creating formulas, and entering functions are all second nature to me (I could do it in my sleep… and often do!). 

But for a beginner, it can be daunting. 

Excel is full of powerful formulas and function capabilities that completely transform the way you operate your business. You can perform complex calculations, automate tasks, and analyse your data efficiently, saving you so much time (and several headaches). 

But understanding all of these formulas and functions and when and how to use them can be just as difficult as picking up a second language.

So, if you’re ready to become fluent in Excel formulas and functions, keep reading.

In this article, I’ll talk you through Excel’s formula syntax and show you some of the best and most commonly used functions to equip you with the basics of your new language so you can harness the full potential of Excel for your data analysis. 

1. The Basics of Excel Formulas

I like to think of Excel formulas as expressions. They’re equations that calculate and manipulate data or generate results based on given inputs. They’re composed of elements such as cell references, operators, and functions.  

The first step to speaking Excel is to understand the key components of formulas. Here are some you should know:

Cell References

Excel formulas often refer to specific cells or ranges of cells to perform their calculations. For example, A1 refers to the cell in column A and row 1, while B2:C6 represents a range of cells from B2 to C6.


Excel utilises various operators to perform mathematical operations. The most commonly used operators include addition (+), subtraction (-), multiplication (*) and division (/). These are all the mathematical operators.

Brackets (Parentheses)

Brackets (or parentheses) are used to group elements within a formula. They establish the order of operation to ensure calculations are performed correctly which is especially important when you’re dealing with complex formulas.

2. Functions: Excel’s Powerhouse Tools

Now you might be thinking “I have no idea where to start with building a formula”. Well, the good news is that you don’t have to start writing formulas from scratch right away. 

Functions are ready-made formulas that perform calculations using specific values (called arguments) in a particular order or structure. 

Excel has a vast library of functions that cater to a wide range of needs. With that in mind, let’s take a look at some commonly used functions:


The SUM function adds up a range of numbers. For example, =SUM(A1:A5) calculates the sum of the values in cells A1 to A5.


The AVERAGE function calculates the average value of a range of numbers. It’s helpful in finding the mean value of a dataset. For instance, =AVERAGE(A1:A10) returns the average of the values in cells A1 to A10.


The COUNT function counts the number of cells within a range that contain numerical values. For example, =COUNT(A1:A10) counts the number of cells with numerical values in the range A1 to A10.


The COUNTA function counts the number of cells within a range that are not empty. Unlike the above formula, this will count cells that contain Text, Dates or Characters. For example, =COUNTA(A1:A10) counts the number of cells that are not empty in the range A1 to A10.


The IF function allows for conditional calculations. It evaluates a condition and returns one value if true and another if false. Here’s what it looks like: =IF(condition, value_if_true, value_if_false). 

This function is valuable for creating dynamic calculations based on specific criteria.


The VLOOKUP function is used to search for a value in the first column of a range and returns a corresponding value from a specified column. It’s often used for data retrieval and lookup operations.


The CONCATENATE function combines multiple text strings into a single string. It’s useful for merging data from different cells or adding additional text. For instance, =CONCATENATE(A1, ” “, B1) joins the values of cells A1 and B1 with a space in between.

3. Understanding Formula Syntax

Just like with learning any language, understanding syntax as well as words will help you structure well-formed sentences.

Even though it’s not a spoken language, syntax in Excel is still very important. In order to get accurate results, we have to be able to ask Excel questions in the right way. 

So, here are some of the important points to consider when it comes to syntax:

Equal Sign (=)

All Excel formulas begin with an equal sign. This tells Excel that the following characters represent a formula and should be evaluated accordingly.

Function Names

Functions are denoted by their names, followed by brackets. For example, SUM(A1:A5) uses the SUM function to calculate the sum of the range A1 to A5.


Functions often require one or more arguments within their brackets. Arguments are the inputs that the function operates on. Arguments can be numbers, text, logical values such as TRUE or FALSE, arrays, error values such as #NAH, or cell references.

Comma Separators

When a function has multiple arguments, they’re separated by commas. For example, AVERAGE(A1:A5, B1:B5) calculates the average of two ranges, A1 to A5 and B1 to B5.

Absolute and Relative Cell References

Cell references in formulas can be absolute or relative. Absolute references remain fixed, denoted by a dollar sign ($), while relative references adjust as the formula is copied to different cells. Absolute references are useful when you want to keep a specific reference constant.

4. Formula Tips and Best Practices

Now that you have a grasp on the basics of formulas and functions, it’s time to build on them to enhance your Excel experience. 

Here are some top best practice tips for formulas: 

Use Cell References

Instead of hardcoding values directly into formulas, make use of cell references. Cell references refer to a cell or a range of cells on a worksheet that can be used in a formula to find the values or data you want to calculate. This allows for easy modification of data and facilitates updates across multiple formulas.

Break Down Complex Formulas

When you’re dealing with complex calculations, break your formulas down into smaller, more manageable parts. This improves formula readability and makes troubleshooting easier.


Documenting your formulas is essential for future reference and collaboration. Add comments to cells (select a cell and press SHIFT + F2 to add a comment quickly) or use adjacent cells to explain the purpose and logic of your formulas.

Test and Verify

Always test your formulas with different scenarios to make sure they produce the expected results. Double-check your inputs, functions, and references to avoid errors.

Explore Help Resources

Excel provides comprehensive help resources, including built-in functions, examples, and tutorials. Utilise these resources to expand your formula knowledge and discover new possibilities. 

Excel Ace also has a wide variety of support options and invaluable tips to help you master your new language.


Understanding the language of Excel formulas and functions will help you to unleash the full potential of this powerful and exciting spreadsheet software. 

By grasping the basics of formula syntax, exploring commonly used functions, and following best practices, you can start to perform more intricate calculations, automate more tasks, and extract meaningful insights from your data.

As you continue to explore Excel’s vast capabilities, don’t shy away from experimenting and learning new formulas and functions. The more comfortable you become with Excel’s language, the more efficiently you can work with data and accomplish your goals – and if you need any help, just get in touch!

Remember, practice makes perfect. The more you use Excel formulas and functions, the more fluent you’re going to become and the easier data analysis will become. 

So, start exploring, experimenting, and harnessing the power of Excel’s formulas and functions to take your data analysis skills to new heights.

Get started with Excel in your business. Take a look at our FREE helpful Excel templates for business. 

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