IFERROR evaluates its first argument. If the result is a value — any number, text, date, boolean, or even an error from a different formula deeper in the chain — IFERROR passes it through unchanged. Only when the first argument itself produces one of Excel's error types — #N/A, #VALUE!, #REF!, #DIV/0!, #NUM!, #NAME?, #NULL! — does IFERROR substitute value_if_error. The substitution is seamless. The cell displays the fallback as if the original formula had returned it. Error types and when they typically appear: #N/A from lookup functions when a value is not found; #DIV/0! from division when the denominator is zero; #VALUE! from type mismatches; #REF! from broken cell references; #NAME? from misspelled function names. For catching only #N/A from lookups while leaving other errors visible, use the
IFNA function instead, which is available in Excel 2013 and newer.