Is it okay to create dummy subsidiaries for consolidation purposes? For example, we would like to create dummy subsidiaries for 6 continents but they are not actual legal entities. We just want to be able to report on those groups. Will there be an issue?

It will probably cause some headaches, but might work ok. Assuming you set these currencies subs up in local currency, building up a balance in Cumulative Translation Adjustment and possibly other currency issues are most likely to cause issues. If you set them up as the same currency as their parent, you'll likely have fewer issues, but could lose some reporting.

That makes sense. The elimination JEs will be posted to a different elimination subsidiary as well (not to the actual parent's) plus currencies and consolidation like you mentioned. Those are enough for us to not proceed with it.