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Preheat oven to 350°F / 180°C. Grease and line 2 x 8 inch (20cm) cake tins.
Steam or simmer the spinach for a few minutes until wilted.
Run under cold water to refresh, drain and squeeze out any excess moisture.
Puree well with a hand blender and set aside.
Beat the eggs, oil, vanilla, applesauce and sugar together well. Beat in the spinach puree.
Sift in the flour, baking powder and salt and gently stir to combine.
Pour into the prepared tins and bake for 25 minutes or until an inserted skewer comes out clean. Cool for 5 minutes in the tin and then turn onto a wire rack to cool completely.
Beat all ingredients together until fluffy. If necessary add a little more milk to thin or icing sugar to thicken.
Refrigerate until ready to spread on the completely cooled cake. Decorate with sprinkles, if desired.