Sift 3 cups flour twice. In a large bowl, mix flour, baking powder, white sugar and cocoa. Cream butter and beat into flour mixture. Add 1/3 cup milk, 1 teaspoon vanilla and chopped walnuts. Mix thoroughly with hands until well blended.
For each biscuit pinch off about 1 teaspoon dough. Roll by hand into balls, each about 3cm in diameter. Place on greased baking trays. Do not flatten. Bake about 10 minutes until lightly browned. Remove from baking trays and cool on racks. When cool, drizzle with chocolate icing.
Melt the chocolate over low heat or in the microwave. Cream with 1 tablespoon butter, 1 teaspoon vanilla and 2 cups icing sugar. Gradually beat in hot milk.