5 oz. or 3/4 c. chopped white chocolate
1/2 c. hot water
1 1/2 c. sugar
1 c. butter
1 tsp. vanilla
3 eggs
2 1/2 c. flour
1 tsp. baking soda
1/2 tsp. baking powder
1/2 tsp. salt
1 c. buttermilk
1/2 c. nuts, coated with flour
1/2 c. coconut

Melt chocolate and water. Cool. Cream butter and sugar and vanilla. Beat in eggs. Add dry ingredients alternately with buttermilk and cooled chocolate mixture. Fold in nuts and coconut. Bake in two 9-inch round pans that have been greased and waxed paper put on bottom and greased again. Bake at 350 degrees for 30-35 minutes.

FROSTING:

5 oz. or 3/4 c. chopped white chocolate
2 1/2 tbsp. flour
1 c. sugar
1 c. milk
1 c. butter
1 1/2 tsp. vanilla

Combine white chocolate and flour. Blend in milk. Cook until thick and cool completely. Cream butter, sugar and vanilla until light and fluffy. Add cooled chocolate mixture and beat until consistency of whipped cream. Spread on cake.