This error can occur when you link to a cell that has one style of formatting applied, but the destination cell is another format. For instance, cell A1 is formatted as currency, but a linked cell with =A1 is formatted as a date. This behavior is limited to linked cells and data types.
If you select the Update format option, Excel will automatically apply the source cell's format for you.
You can change this setting in File > Options > Formulas > Misleading number formats.
If you're using a Mac, the setting is under Excel > Preferences > Error Checking > Misleading number formats.
Note: The Misleading number format error can be evaluated in VBA (Visual Basic for Applications) through the Application.ErrorCheckingOptions.MisleadingNumberFormats property, which will return a Boolean (True/False) value.