You'll need fondant for that. Thin layer of buttercream over the cakes to seal the crumbs and give a smooth finish and then top with fondant rolled out about 1/4 inch thick. The rest of the decoration is also fondant just different colours. The writing will be done with a thick enough to hold shape when piped Royal icing.
To get it smooth, do a search on youtube for "crumbcoating a cake" there is lots on there to follow
To prevent the creases and wrinkles, smooth the top, then pull out each fold or pleat and smooth it down. Work firmly and quickly and you'll find when you get to the end that it just sits smooth. Good luck!