Preheat oven to 350 degrees. Grease and flour 10 inch tube pan. Add eggs, water and oil; blend, then beat, medium speed for 2 minutes. Fold in zucchini. Turn batter into pan and spread evenly. Bake at 350 degrees for 50 to 60 minutes.
Frosting: Beat cream cheese, butter and vanilla in bowl. Add conf. sugar and milk, mix until smooth and creamy. Add more sugar to thicken and more milk to thin. Spread on cooled cake. Sprinkle nuts on top. Store in refrigerator until ready to serve.