I am trying to understand the differences between IRR and XIRR in Excel.

If my data is as follows:

1/1/1998 -10,000
1/2/1998 10,005

The IRR for that data is .05% for the 1 period return - which I assume means
that the annual return is 365 times the 1 period return or 18.25%

The XIRR for that data is 20.01594%.

Shouldn't the IRR percentage and the XIRR percentage be the same for a
calculation?

If I put in a series of payments that exactly match a 365 day period between
payments, the IRR and XIRR are the same. For instance:

12/31/2000 -70,000
12/31/2001 12,000
12/31/2002 15,000
12/31/2003 18,000
12/31/2004 21,000
12/31/2005 26,000

The IRR for that series is 8.663% and the XIRR is 8.660%. I guess since the
IRR assumes each period to be a year and since XIRR calculates each
difference in date to be a year, I understand why it works - but I don't
understand why it does not work if the period is something different than an
exact year.

Any insights?