There is surprisingly very little information about what the actual IARR algorithm is. IARR stands for Internal Average Relative Reflectance and the idea is that you extract the spectral information from the raw data by measuring the mean spectrum of the whole image. Every pixel vector is normalised by this global spectral mean to produce a 'relative reflectance' image. The psuedo-code for this algorithm is as follows:
for each band
compute mean
for each pixel in a particular bad
divide by the computed mean for this band
That's it.