How Does Excel Find Circular Reference Errors? [2 Easy Ways]

Can Excel find circular reference errors without having to do any complex calculations? The short answer is yes. All you have to do is head to the file path Formulas > Error Checking > Circular Reference, and the menu will display any circular references. But, there is a little more to learn about circular references in Excel. Read on if you’d like to learn more.

What Is a Circular Reference in Excel

Circular references in Excel can occur when a formula refers to the cell it is in or another cell value during calculation that causes it to repeat endlessly.

A reference occurs when a formula uses the value from another cell to make a calculation.

When the cell references itself or the cell referenced in the formula contains a reference back to the primary cell, Excel can not complete the formula and essentially gets stuck in an infinite loop.

Excel turns circular references off by default and only sends a message when it occurs. If a circular reference occurs, users can click a button to return the cell value to 0.

There are two ways in which a circular reference in Excel error can occur. These are:

  • Direct: Direct circular references can occur when you enter the cell’s address. For example, you want to add cell numbers from A1 to A10. You would write the formula as =SUM(A1:A10) to do this. Assume that you are writing this formula in cell A11. If you make an error and write the formula as =SUM(A1:A11), this will add the reference to the cell the formula is in, causing a direct circular reference.
  • Indirect: Indirect circular references can occur when the cell reference contained in the formula refers back to the original cell. Let’s explain that using an example. Assume that you have three cells: A1, B1, and C1, which contain numerical values you want to add. To do this, you would write the formula as =SUM(A1,B1,C1). Assume that you are writing this formula in cell A6. However, cell B1 contains =A6 instead of a numerical value. This means that the cell is indirectly referencing back to the cell that contains the formula, which will display an error, as well as an arrow connecting the cells that cause the error.

Before we look at the types of circular references in Excel, let’s settle the Excel vs. Sheets debate. Here are some of the key differences between Excel and Sheets in 2024.

Types of Excel Circular References

Excel circular references can happen for several reasons. Here are some reasons why circular references occur in Excel:

  • Unintended: This is one of the most popular types of circular references, as most users don’t do it intentionally. Unintentional circular references happen when an Excel user uses a function or a formula and adds an accidental reference to itself. Unintended circular references can cause formula mistakes, incorrect cell references, and errors with copy-pasting. Resolving these errors is crucial to ensure correct calculations.
  • Intended: Circular references aren’t bad; some users may want to use them to do repeated calculations, such as adding numbers within themselves or creating looping calculations. For example, circular references can be helpful for calculating interest payments.
  • Hidden: These types of circular references aren’t immediately apparent in the formulas that are being applied. This can often occur in complex spreadsheets. Often, circular references may not trigger an Excel error message, especially when there are multiple formulas in a single spreadsheet.

There are multiple spreadsheet programs with great functionality that you can use nowadays. However, most people still either use Google Sheets or Microsoft Excel. Here is a guide on how to convert Sheets files to Excel and vice versa.

Ways to Locate Circular Reference in Excel

There are essentially two easy methods to locate a circular reference in Excel. Let’s take a look at both of them:

How Does Excel Find Circular Reference Errors by Formula Auditing?

The formula auditing options in Excel allow you to show the relationship between the formulas and the cells. Here is how to identify circular references in Excel:

  1. Open Excel and go to the worksheet where you want to find the circular reference. Our spreadsheet contains an indirect circular reference. Indirect circular references are usually shown using arrows.
Open the formulas menu
  1. Click on Formulas in the main bar.
Open the error checking menu
  1. Head to the Formula Auditing section and click the arrow beside Error Checking to open a dropdown menu.
Open the circular reference errors box
  1. Now, hover your cursor over the Circular References button. A small menu will show all the cells where the circular references occur.

The method is excellent if you want to find out multiple circular references. The bottom bar of Excel can also be used to show circular references in Excel, but this method is best used when you want to see the circular references at a glance.

How to Locate Circular Reference in Excel by Tracing Relationships

In some cases, finding circular references in Excel can be extremely frustrating, especially if the formula has multiple parameters. In these cases, it’s best to trace the relationships between variables. Here is how to do this:

  1. Open Excel and go to the worksheet where you want to locate the circular references.
Open the formulas menu again
  1. Here, click on Formulas in the main bar.
Click trace precendents or trace dependents
  1. Now, go to the Formula Auditing section and click on Trace Precedents or Trace Dependents based on your needs.
    1. Trace Precedents: This option will create tracers for the cells that provide data to the formula used. This will draw lines to show which cells impact the selected cell. You can also access this function using the Alt + T – U – T keyboard shortcut.
    2. Trace Dependents: This option will create tracers for the cells dependent on an active cell. This will draw lines to show the cells that are impacted by the cell that is selected. You can also access this function using the Alt + T – U – D keyboard shortcut.
Remove arrows
  1. This will create a tracer line to help you see the relationships. To remove the tracer lines, head to the Formula Auditing section and click the Remove Arrows button.

Like Microsoft Excel, Google Sheets users can also encounter circular dependency errors. To fix it, check out our guide on how to fix circular dependency errors.

Tips to Fix or Find Circular Reference in Excel

Here are a few tips to find and fix circular references in Excel:

  • Increase Iterations: If you want circular references to work in your spreadsheet, you can enable iterative calculations. To do so, click on File and click on Options. There, click on Formulas and click to Enable Iterative Calculation from the checkbox. This will increase the number of iterations performed in your workbook till it meets a specified condition.
  • Replace Values: You can remove circular references by modifying the formula or the cell of the formula references. If the cell refers back to the original cell, then you can replace the contents of the cell. You can also alter the formula to refer to a different cell or cell range or remove the cell reference entirely.

Although Excel is a great spreadsheet tool, many people may not be willing to pay for an annual Office 365 subscription to use it. Here are some of the best 8 Excel alternatives for Macs in 2024.

Frequently Asked Questions

How Do I Find Circular References in Excel?

To locate circular references in Excel, open the workbook where you want to check for circular references. Click on Formulas in the main toolbar and head over to the Formula Auditing section. Here, click on the arrow towards the right of Error Checking. In the open dropdown menu, click on Circular References, which will display a list of the cells containing circular dependencies.

How Does a Circular Reference Occur?

Circular references can occur when a formula refers to the same cell or cell group that depends on each other, creating an infinite loop. There are two ways in which circular references can occur. Indirect circular references happen when the formula refers to the cell it is in. Direct circular references happen when the cell containing the formula adds a direct reference to itself.

Wrapping Up

If you’ve been asking yourself, “How does Excel find circular reference errors?” You now know all the answers. If you found this guide useful, you may want to check out our premium templates. There are plenty of time-saving spreadsheets in our library, and best of all, you can use the code SSP to save 50% on any purchases.

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