If unchecked, spreadsheet output from reports is in the form of Excel spreadsheets using the .xls or .xlsx format. If checked, spreadsheet output is created using the .xml spreadsheet format. Output to .xls/.xlsx spreadsheets requires a licensed copy of Excel on your computer, whereas .xml output does not require any other software on your computer. Non-Excel spreadsheet applications such as OpenOffice Calc can read .xml output, as can Excel itself.
XML spreadsheet output has somewhat less formatting than Excel output. Comma-delimited (.csv) output, which is always another option for spreadsheet output, has no formatting at all.
This option is selected in File/System Options.