Stir together powdered sugar and meringue powder. Gradually still in water.
Pour in vanilla and stir until smooth.
Diving icing into number of bowls corresponding to number of colors you want to use.
I recommended adding 1-2 extra tbsp of powdered sugar to one of the bowls to make a thicker icing. This thicker icing is good for piping edges that you can let dry, and then flood the inside with a less viscous icing.
Add gel food coloring and mix until desired color is reached. NOTE: Liquid food coloring does NOT dry well, the icing comes out looking marbled.
Cover bowls with plastic wrap and let sit for at least 10 minutes to get the air bubbles out.
Icing can be applied using a pastry bag or bottles. I prefer Wilton 6oz squeeze bottles. NOTE: The icing can be tough to get into the bottles. Using a funnel with a tip as wide as can fit in the bottle opening is helpful.
If you are using more than one color, let the first one dry for 12-24 hours so the colors will not mix.
It is helpful to squeeze a thicker icing outline, then flood the center with icing. Working quickly, a spoon works well to spread it out, and a toothpick can help with fine details.