See my summary above
It's hard to say exactly why you're encountering this error without seeing your spreadsheet, but I don't think the problem is IRR-specifically, but rather an issue with your data. The IRR function usually returns #NUM! if it can't calculate an Internal Rate of Return. I wrote about #VALUE! errors a while back, so this article http://www.accountingweb.com/technology/excel/resolving-value-errors-in-... may help you clear up the issue. Or feel free to elaborate further about your use of IRR and I'll be glad to see if I can help you get this resolved.
Not sure if you are aware but #VALUE! is the most generic Excel error that you can get so maybe some general troubleshooting is in order.
If you go to Formulas > Trace dependents and it should bring up an "Error Checking" dialogue. You can click the "Show Calculation Steps.." and it will walk you through the formula step by step and you can see how the formula evaluates at each step.