Place coconut in a large resealable plastic bag. Add enough food color to tint to desired shade of yellow. Using bag, knead color into coconut until evenly distributed. Pour coconut into a shallow dish.
Spoon 1/4 cup of the frosting into a piping bag. Place remaining frosting (in can) in microwave and heat for 15 seconds. Stir until thin enough to coat doughnut holes, about the consistency of honey. Microwave 5 to 10 seconds more, if needed.
Spear 1 doughnut hole on a fork. Dip in frosting to coat. Tap fork gently against frosting can until excess has dripped off.
Push doughnut hole off fork into coconut. Gently roll to coat. Transfer to a parchment or wax paper-lined sheet. Repeat with all doughnut holes.
Snip piping bag. Pipe frosting to affix chocolate chips for eyes. Cut candies into triangles to resemble beaks.