Described is a system and method by which a unique and permanent identifier is added to tags in hierarchically-arranged data (e.g., an XML or XAML file) by a first tool. The data with the unique and permanent identifiers is processed by a second tool into a flat file of key-value pairs, with the key being constructed from the identifier and attribute names, and the value comprising the corresponding value for that attribute. When the flat file from the new data file is compared to a flat file from an earlier version of the file, a standard merge program is able to better detect the differences, including differences caused by complex edits. The comparison is more granular than it would be if simply comparing the hierarchically-arranged file versions, thereby providing significant benefits in localization and other version tracking scenarios.