Preheat the oven to 325 degrees F. Line 2 cupcake tins with paper liners and set aside.
In a small dry skillet, toast the shredded coconut over medium-high heat until starting to brown on the edges. Off heat, and remove from pan to a plate to cool.
In the bowl of an electric mixer fitted with the paddle attachment, cream the butter and sugar on high speed until light and fluffy, about 5 minutes. With the mixer on low speed, add the eggs, 1 at a time, scraping down the bowl after each addition. Add the vanilla and coconut extracts and mix well.
In a separate bowl, sift together the flour, baking powder, baking soda, and salt. In a liquid measuring cup, combine the buttermilk and the cream of coconut – whisk to combine. In 3 parts, alternately add the dry ingredients and the buttermilk to the batter, beginning and ending with the dry. Mix until just combined.
Fill each liner 2/3 of the way. Bake for 25 to 35 minutes, until the tops are brown and a toothpick comes out clean. Allow to cool in the pan for 15 minutes. Remove to a baking rack and cool completely.
Meanwhile, make the frosting. In the bowl of an electric mixer fitted with the paddle attachment, on low speed, cream together the cream cheese, butter, and extracts. Carefully add the confectioners’ sugar and mix until smooth.
Frost the cupcakes as desired and sprinkle with the toasted coconut to garnish.