Custom tags decline: a subtle but significant signal from US GAAP filers
When the SEC first mandated XBRL tagging over a decade ago, it marked the beginning of a data-driven revolution in corporate disclosure. No longer were financial statements locked in static PDFs; they became machine-readable, enabling regulators, investors, and analysts to slice and dice data with ease. But as with any revolution, the early days were a bit messy. Custom tags—bespoke data elements added by companies when standard ones didn’t quite fit—became both a blessing and a burden.
Fast forward to 2024, and the US Securities and Exchange Commission (SEC) is still keeping a close eye on these custom tags. The Division of Economic and Risk Analysis (DERA) has just released its latest review of XBRL filings under US GAAP, covering the past three fiscal years. The headline? A clear decline in the use of custom tags across most filer types, with only large accelerated filers holding steady.
Custom tags are permitted only when the standard taxonomy doesn’t offer a suitable match. While they help reflect the unique nuances of a company’s disclosure, excessive use undermines one of the key goals of XBRL: comparability. That’s why the SEC has long encouraged restraint, and why these year-on-year trends matter.
DERA’s latest analysis builds on previous years’ data, which have shown a gradual tightening in custom tag usage. This year’s drop continues that trajectory, suggesting a maturing ecosystem—one where filers are increasingly aligning with taxonomy standards, supported by better tools and guidance. It also speaks to improving quality in XBRL implementation, especially among smaller and non-accelerated filers.
We see this as a sign of progress. Structured data is only as good as it is consistent, and reducing unnecessary customisation makes financial information more comparable and more useful—especially for regulators and data users leveraging AI and analytics. The flat trend among large filers hints at the next challenge: perhaps it’s time for the taxonomy itself to evolve further, closing gaps where these entities still rely on custom tags.
Explore the full SEC analysis and dive into the numbers here.
