Formatting Cells is a way of changing the view of the Cell. All Cells by default is set as general with no specific format being assigned. Although as you would notice Excel tries and figures out the best format like Dates.
The Fraction Category is the eighth of the explicit option you can choose from. As per the below screenshot, you will notice there are quite a few options to choose from.
The thing we need to remember is Excel does not read data the same we do.
As per the table below you will see the same number converted in all the different options available. At a glance, we can already see there are values that are incorrect when in the Fraction Format.
The reason for this is because this is a view in the background Excel still only reads this as a Decimal Value. Excel displays the number as close as possible in the format you choose. Thus working with Formals will still give you the correct answers. As per the below table if we count Fractional Values together displayed in Fractional and Decimal.
The responsibility is on the user to choose the Fraction option that most closely resembles the decimal values they are working with.