Combine coconut and milk in a bowl and stand for 1 hour. Cream butter, sugar and orange rind until light and fluffy. Beat in the eggs one at a time, beating well between each one. Fold in the sifted flour alternately with the coconut mixture and the extra milk (mixture may appear curdled at this stage), finishing with a batch of flour. Grease and lightly flour a deep loaf tin (approx 11cm x 20cm) or a medium square tin (18-20cm square), pour in the cake mixture and bake at 325-350° for about 50 minutes. Test with a skewer and if not cooked through, bake at 325° for a further few minutes as needed.
Allow to cool in tin for about 5 minutes before turning out to cool completely. Beat together the icing sugar, butter and enough warmed orange juice to make a smooth paste (if icing is too runny, I sometimes add some coconut rather than extra icing sugar). Spread icing on the completely cooled cake..