Start by melting butter in a large pot over medium heat.
Add flour. If you are using onion and mustard powder, then add it now and cook for 1 minute.
Add milk and mix into butter and flour mixture and stir until it starts to thicken slightly.
Pour in the water and add salt and pepper.
Stir in the macaroni and mix. Stir as it starts to bubble and turn down the heat to low. Cook for 10 minutes until tender but firm. Remember that the macaroni continues cooking and the sauce thickens even after it has been removed from the stove.
Remove from the stove and mix in the grated cheese.
Garnish with chopped chives or parsley if you like.