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In a mixing bowl, combine the caster sugar, oil, eggs and carrots. Beat for 2 minutes.
Sift the dry ingredients into another bowl. Add in batches to the carrot mixture, mixing well after each addition. Preheat the oven to 190°C / 375°F / Gas Mark 5 for 45min. Grease and flour two 23 centimetres / 9 inches round layer cake tins.
Divide the cake mixture evenly between the prepared cake tins. Bake for 35 to 45 minutes, or until a skewer inserted in the centre of a cake comes out clean. Cool in the tins for 10 minutes, then transfer the cakes to wire racks to cool completely.
Beat all the icing ingredients except the nuts in a bowl until smooth. Sandwich the layers together with one-third of the icing, then spread the remaining icing over the top and sides of the cake, swirling it to make a decorative finish. Sprinkle the nuts around the rim.