Internal rate of return (IRR) and modified internal rate of return (MIRR) are Excel functions you can use to determine the rate of return on your investment. IRR assumes that all cash flows generated by an investment will be reinvested at the same rate as the IRR. By contrast, MIRR assumes that all future cash inflows get reinvested at a specific rate of return.

In real-world situations, MIRR may be a more accurate measure of investment profitability, especially when cash inflows are not reinvested at the same rate as the initial investment.

This open-access Excel template is a useful tool for bankers, investment professionals, corporate finance practitioners, portfolio managers, and anyone preparing a corporate presentation.

Internal Rate of Return (IRR) is among the topics included in the Corporate Finance module of the CFA Level 1 Curriculum. Gain valuable insight into the subject with our Corporate Finance course.

You can also explore other related templates such as—Net Present Value (NPV), Payback Period, and Discounted Payback Period.