Kerberos is probably enabled on your proxy server. It's not something Office for Mac itself uses. The expiration in your screenshot compared with the time of your post here suggests you're receiving the authentication prompt although you have a valid Kerberos ticket. That sounds like a proxy issue to me.
The reason you're being prompted for credentials is your proxy is receiving traffic from various parts of Office that are trying to access Microsoft servers. For a detailed list of servers that Office uses, see this document put together by Paul Bowden with Microsoft: http://macadmins.software/docs/Network_Traffic.pdf.
Adding the server address to the proxy bypass list might work to quash the message, but I think you'd have a better user experience if you worked with your network administrator to address all the addresses in the document above. Of course, Microsoft will suggest you allow unfettered access to these addresses from any client on your network. Your network administrator may have a preferred method for dealing with them.
