Prepare the Dough:

• In a small bowl, combine warm milk and yeast. Let sit for 5 minutes until foamy.
• In a large bowl, mix flour, sugar, and salt. Make a well in the center and add melted butter, egg, and the yeast mixture.
• Mix until a dough forms. Knead on a floured surface for about 5 minutes until smooth and elastic.
• Place in a greased bowl, cover, and let rise for 1 hour or until doubled in size.

Shape the Doughnuts:

• Roll out the dough on a floured surface to about 1/2 inch thickness.
• Cut out doughnuts using a doughnut cutter or a large and small round cutter.
• Place cut doughnuts on a baking sheet, cover, and let rise for another 30 minutes.

Fry the Doughnuts:

• In a large pot, heat vegetable oil to 350°F (175°C).
• Fry doughnuts until golden brown, about 1 minute per side. Remove and drain on paper towels.

Prepare the Topping:

• Warm the caramel sauce if necessary to make it pourable.
• Spread a thin layer of caramel on each doughnut.
• Sprinkle chopped pecans over the caramel layer.

Final Touches:

• Drizzle additional caramel sauce on top if desired.