In a mixing bowl, combine all cake ingredients and mix with an electric mixer until all the lumps are gone.
Pour into the prepared pan and place in the oven. Cook for about 60 minutes or until a toothpick comes out clean.
In a medium saucepan, melt the butter on the stove. Whisk in the water and sugar, and bring to a light boil. Stirring constantly, cook it for about 5 minutes. When the 5 minutes is up, remove the pot from the stove and pour in the rum.
Allow the mixture to cool a bit. Turn the bundt cake out onto a plate or cookie sheet. When the topping mixture is cooled, use a spoon to drizzle the mixture over the top of the cake, making sure to get all of the cake.
(Optional) Add the unsweetened coconut flakes to a small, dry frying pan over medium heat. Stir for a few minutes until the coconut is toasted and has turned brown. Sprinkle over rum cake.