I have this in my recipe file that I've tried, but it has been a long time since I've used it. I don't add recipes to my file though unless I really liked them.
Caramel Frosting
1 cup brown sugar
½ cup butter
¼ cup milk
Bring all ingredients to a boil on medium heat, cook and stir 2 minutes. Remove from heat, stir in 1 tsp vanilla, cool to lukewarm. Slowly beat in enough powdered sugar to spreading consistency.

I got this one from Betty Crocker. I am making a Caramel Cake for Christmas. I just love Caramel.

Caramel Icing
1/2 cup butter or margarine
1 cup powdered sugar
1/2 cup reserved cake batter
1/2 cup evaporated milk
1 teaspoon vanilla

To make icing, heat butter in 1-quart saucepan over low heat, stirring constantly, until brown; remove from heat. Stir in powdered sugar, cake batter and evaporated milk. Cook over medium heat, stirring constantly with wire whisk, until smooth, bubbly and almost thick; remove from heat. Stir in vanilla. Cool slightly. Fill layers and frost cake with icing. Store loosely covered.