3/4 c. white chocolate, coarsely chopped
1/2 c. water
2 1/2 c. all-purpose flour
1 1/2 c. sugar
1 tsp. baking soda
1/2 tsp. baking powder
1/2 tsp. salt
1 c. butter (soft)
1 c. buttermilk
3 eggs
1 tsp. vanilla
1/2 c. nuts, chopped
1/2 c. flaked coconut

In a small saucepan, melt white chocolate with hot water over low heat. Cool. Combine flour, sugar, soda, baking powder, salt, butter and buttermilk. Blend until moistened. Beat one minute at medium speed. Add eggs and melted chocolate and vanilla. Blend and beat one minute. Stir in nuts and coconut. Pour into 2 (9 inch) pans, greased and floured on bottom only. Bake at 350 degrees for 30 to 35 minutes. Cool 15 minutes and remove from pan.

FROSTING:

3/4 c. white chocolate, coarsely chopped
2 1/2 tbsp. flour
1 c. milk
1 c. butter, softened
1 c. sugar
1 1/2 tsp. vanilla

In medium saucepan, combine white chocolate and flour. Blend in milk. Cook over medium heat stirring thoroughly until very thick. Cool. In large bowl, cream butter, sugar and vanilla. Beat until light (about 3 minutes). Add cooled white chocolate mixture. Beat at high speed until the consistency of whipped cream. Yields 20 servings.