Preheat oven to 160oC. To make the chocolate icing, place the icing sugar, cocoa, water and butter in a bowl and whisk to combine. Set aside.
Beat the butter, sugar and vanilla in an electric mixer until light and creamy. Gradually add the eggs and beat well. Add the flour and baking powder and mix until well combined. Stir in the milk.
Spoon into a lightly greased 20cm x 30cm tin lined with non-stick baking paper and bake for 20 minutes or until cooked when tested with a skewer. While still warm, cut into squares and carefully pour over icing. Top with coconut.