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In this video tutorial, the speaker introduces number formatting in Excel and its importance in enhancing the readability of dashboards and reports. They demonstrate how to access number formatting by going to the Home tab and using the drop-down menu within the number group. This menu provides options for general number, currency, date, time, percentage, and fractions formatting. For more customization, users can click on the "more number formats" option to open the format cells dialog box. The tutorial aims to help users understand how to access and create their own number formats in Excel for better data representation.