The ruffle around the bottom is crepe paper that I sewed around the edge of the hat and then "snipped" with scissors. The other crepe paper element is the yellow "flower" around the number 2. I made this using a fun technique I learned a while back from Got Sketch 101 with Valerie Salmon and Jana Wilson at Got Crafts? .
Cover your circle with dry adhesive (like Tombow, Duck, Kokuyo) and then carefully wind the folded crepe paper around the circle filling in as you go.
Tear off the excess and then add a button, brad or some other item as your "center".... viola! This is a fun and easy embellishment that can really add some cute kick to your next project!