Preheat oven to 140°C. Grease two deep 22cm (9-inch) round cake pans; line bases and sides with baking paper, extending the paper 5cm above sides.

Beat butter, sugar, extract, eggs, sifted flours and milk in a large bowl with an electric mixer on low speed until combined. Increase speed to medium; beat about 2 minutes or until mixture is smooth and changed to a paler colour. Spread mixture evenly into pans; tap gently on the bench to release large air bubbles.

Bake cakes about 1 hour. Stand in pans 5 minutes; turn, top-side up, onto wire racks to cool.

Meanwhile, make white chocolate ganache; stir ingredients in a large heatproof bowl over a large saucepan of simmering water until smooth. Cover; refrigerate about 3 hours or until thick. Beat ganache in a large bowl with electric mixer until firm peaks form.

Place white chocolate melts in a small heatproof bowl over a small saucepan of simmering water; stir until melted. Divide chocolate into four small bowls; tint chocolate with colourings.

Working with one colour at a time, spoon chocolate into small piping bags. Pipe small, medium and large discs onto a baking-paper-lined tray; tap tray gently on the bench to flatten rounds. Stand at room temperature until set.

Level top of cakes. Place one cake on a cake stand or prepared cake board; spread with one-third of the ganache, top with other cake. Spread remaining ganache all over cake. Decorate with chocolate discs.