In a 3-quart saucepan over high heat, bring the barley and 4 cups of water to a boil. Reduce heat to low and continue cooking for about 30 minutes. Drain and set aside.
(If using quick-cooking barley, omit this step.)
In a Dutch oven or saucepot, over medium-high heat, heat the olive oil. Add the celery and onion, continuing to cook for about 10 minutes, or until soft. Add the mushrooms. Cook for about 10 minutes until the liquid evaporates and the mushrooms are lightly browned. Reduce the heat and add the tomato paste. Cook, stirring, for about 2 minutes.
Add the beef broth, carrots, sherry, salt, barley, (not if using the quick-cooking barley) and about 4 cups of water, (use the reconstituting liquid from the dried musahrooms, if using, and adding enough water to make 4 cups.) Heat until it reaches a boil, then reduce immediately to low.
Cover and simmer for about half an hour, or until the carrots and barley are tender. (If using quick-cooking barley, add it about 15 minutes into the last simmering and cook for 10-15 minutes.)