1 pkg. yellow cake mix
1 sm. pkg. vanilla instant pudding
1/4 c. vegetable oil
1 c. chopped nuts
1 1/3 c. water
4 eggs
2 c. coconut

Preheat oven to 350 degrees. Blend the cake mix, pudding mix, water, eggs and oil in a large mixing bowl. Beat at medium speed for 4 minutes. Stir in the coconut and nuts. Pour into greased and floured, 9 inch layer cake pans. Bake for 35 minutes. Cool in pan for 15 minutes. Remove and cool on racks. Chill and top with coconut cream cheese frosting, which follows:

COCONUT CREAM CHEESE FROSTING:

4 tbsp. butter
1 (8 oz.) pkg. cream cheese
3 1/2 c. sifted powdered sugar
2 c. coconut
2 tsp. milk
1/2 tsp. vanilla

Melt 2 tablespoons of the butter in a skillet. Add the coconut and stir constantly over low heat, until golden brown. Spread the coconut on absorbent paper to cool. Cream the remaining 2 tablespoons of butter with the cream cheese. Add the milk. Gradually, beat in the sugar. Blend in the vanilla. Stir in 1 3/4 cups of the coconut. Spread on tops of the cake layers. Stack the layers and sprinkle the remaining coconut over the top.