Melt the white chocolate chips in the microwave, stirring every 30 seconds until smooth. Be careful not to burn the chocolate. Pour the melted chocolate over the cereal and toss to coat. Pour the cereal mixture into a large Zip-lock bag.
Whisk together the pudding mix and powdered sugar in a small bowl. Add the mixture to the cereal mixture in the bag. Seal the bag and shake to coat well.
Add coconut flakes, toss to coat, and enjoy! Store in an airtight container.