1/2 cup water
4 ounces white confectioners coating or vanilla chips
1 cup butter or margarine, softened
2 cups sugar
4 eggs, separated
1 tablespoon vanilla extract
2 1/2 cups all-purpose flour
1 teaspoon baking soda
1 cup buttermilk
1 cup flaked coconut
1 cup chopped pecans

FOR FROSTING:
1 (8 ounce) package cream cheese, softened
1/2 cup butter or margarine, softened
1 teaspoon vanilla extract
3 3/4 cups confectioners' sugar
1 tablespoon milk

1. In a saucepan, bring the water to a boil. Remove from the heat; stir in confectionery coating until melted. Cool for 20 minutes. Meanwhile, in a mixing bowl, cream butter and sugar. Add egg yolks; mix well. Beat in coating and vanilla. Combine flour and baking soda; add to creamed mixture alternately with buttermilk. Mix well. Stir in the coconut and pecans. Beat egg whites until stiff peaks form; fold into the batter. Pour into three greased and floured 8-in. square baking pans. Bake at 350 degrees F for 25-30 minutes or until cake tests done. Cool in pans 10 minutes; remove to wire rack to cool completely.

2. Combine frosting ingredients in a mixing bowl; beat well. Frost tops of two layers; stack on serving plate with plain layer on top. Frost top and sides of cake.