Preheat the oven to moderate 180°C (Gas Mark4, 350°F).

Put the chocolate, milk, brown sugar and 1 egg yolk in the top part of a double boiler, or in a heatproof bowl placed over a saucepan of simmering water. Set the boiler or pan over low heat and simmer the mixture, stirring constantly with a wooden spoon, until the chocolate melts and the mixture thickens slightly. Remove the mixture from the heat and set aside while you prepare the rest of the batter.

Put the flour, salt and soda into a bowl.

Put the butter into a second bowl and beat with a wooden spoon until it is creamy. Gradually add the castor (superfine) sugar, beating constantly. Add the remaining egg yolks, one at a time, beating well after each addition. Lightly mix in about a third of the flour, followed by half the water. Add the remaining flour and water, and beat until the batter is smooth. Stir in the vanilla and chocolate mixture until they are thoroughly blended.

Beat the egg whites until they form stiff peaks. Lightly fold them into the batter.

Pour the batter into three shallow greased cake tins lined with greased greaseproof or waxed paper. Place the tins in the oven and bake for 25 minutes, or until a skewer inserted into the centres comes out clean. Remove from the oven, loosen the cakes with a knife and turn them on to a wire rack to cool.

To make the frosting, bring the cream to the boil in a heavy-based saucepan. Remove from the heat and stir in the sugar, salt and grated chocolate. Return the pan to the heat and cook the mixture, covered, for 3 minutes. Do not stir. Uncover, reduce the heat to low and cook until the mixture reaches 120°C (238T) on a sugar thermometer, or until a teaspoon of the mixture dropped into iced water forms a soft ball. Remove the pan from the heat and plunge it into a larger saucepan filled with cold water.

When the mixture has cooled to 45 °C (no°F), or the bottom of the pan is cold enough to touch, beat in the butter and vanilla. Continue beating until the frosting thickens and reaches spreading consistency. Stir in the walnuts.

Sandwich the three rounds of cake together with three-quarters of the frosting and spread the remaining frosting over the top and sides, using a palette knife or spatula to make swirling decorative patterns. Leave the frosting to cool before serving.