January 15, 1996
Fellow Shareholders:

This has been an important year for the Funds.  As earlier  reported,  following
the  special  shareholders  meeting  on  September  28, the  Sextant  Funds were
launched,  new  trustees  were elected and other  significant  steps were taken.
These proposals were contained in the proxy statement we forwarded to you at the
end of August.

The following is an official report of the results.  For investment  results and
other  information  about the Funds,  we urge you to read the  remainder  of the
Report.

As always,  we appreciate your  participation in the Funds and look forward to a
long and mutually rewarding association with you.

ATTENDANCE
                           Shares entitled
     Name of Series           to vote                  Shares present
     Idaho                1,032,867.080                602,773.681
     Washington             190,004.237                120,153.290
     Northwest              131,055.262                86,794.841
                            -----------                ----------
     Total Shares         1,353,926.579                809,721.812

NEW BOARD OF TRUSTEES
The shareholders  also elected a new slate of Trustees.  Continuing are: John
Love,  John  Moore  and  Nicholas  Kaiser.  Joining  them are  newly  elected
Trustees Gary Goldfogel and James D. Winship.

                                For             Withhold
     Gary Goldfogel         527,875.466        13,842.597
     Nicholas F. Kaiser     536,614.069         5,103.994
     John Love              538,530.426         3,187.637
     John S. Moore          534,302.917         7,415.146
     James D. Winship       540,673.148         1,044.915

NORTHWEST GROWTH FUND BECOMES SEXTANT GROWTH FUND

Shareholders voted to amend the Northwest's  investment objective from long-term
capital growth through investment primarily in Northwest securities to long term
growth  from  investment  in equity and  equity-type  securities  whether in the
region or not, and to change the name of the series to Sextant Growth Fund.

              Number         Per Cent
     For      84,989.275      97.92%
     Against  1,805.566       2.08%

Shareholders  voted to  replace  Northwest  Growth  Fund's  existing  Investment
Advisory and Administrative Services Agreement and Transfer Agent Agreement with
a single Investment Advisory and Administrative Services Agreement.
              Number         Per Cent
              ------         --------
     For      86,794.841      100%
     Against        0            0%

WASHINGTON TAX-EXEMPT FUND BECOMES SEXTANT BOND INCOME FUND

 Shareholders  voted to amend the Fund's  investment  objective and  fundamental
 policies  from pursuit of income exempt from federal and any  Washington  State
 income  taxes to high  current  income  through the  purchase of bonds that may
 produce  taxable  income,  and to change the name of the series to Sextant Bond
 Income Fund
              Number         Per Cent
     For      115,009.485     95.72
     Against  5,143.805       4.28%

Shareholders  voted to  replace  the Fund's  existing  Investment  Advisory  and
Administrative  Services  Agreement and Transfer  Agent  Agreement with a single
Investment Advisory and Administrative Services Agreement.
              Number         Per Cent
     For      115,009.485     95.72
     Against  5,143.805       4.28%

IDAHO TAX-EXEMPT FUND REMAINED UNCHANGED.

This very  successful  Fund continues with no change in policy or its investment
contract.

<PAGE>



                             IDAHO TAX-EXEMPT FUND
                                 ANNUAL REPORT
WE ARE GREATLY PLEASED TO INFORM YOU THAT  MORNINGSTAR  MUTUAL FUNDS HAS AWARDED
YOUR FUND ITS COVETED  FIVE-STAR RATING AS OF NOVEMBER 30, 1995. THE MORNINGSTAR
RATING IS A WIDELY RESPECTED MEASURE OF RISK-ADJUSTED PERFORMANCE.* WE ARE PROUD
OF THIS ACCOMPLISHMENT AND WORK HARD TO CONTINUE THE FUND'S TO PERFORMANCE.

November 30, 1995
Fellow Shareowners:

Where  do we go from  here?  Our  last  letter  was very  optimistic  about  the
potential  returns  from  financial  assets for the  remainder  of the  century.
Throughout fiscal 1995 we were correct and our positive outlook remains.  In the
fiscal  year just ended,  your Fund  brought  you a total  return of 16.68%.  At
November 30, the 30-day yield on your Fund was 4.6%, tax-free.

Politically,  the climate is still favorable though not as bullish as last fall:
lower taxes and higher  speed  limits.  The debate has shifted  from  increasing
government  expenditures  to  whether,  where  and how  much to  cut.  For  bond
investors,  we continue to believe this trend means slow growth and low interest
rates.

During 1995,  concerns over the  possibility of a flat (or at least flatter) tax
structure put some pressure on bond prices by increasing the return that holders
of municipal bonds demanded.  This phenomenon produced an opportunity for buying
quality bonds cheaply. We capitalized on that opportunity when we could.

The Fund remains  conservative in approach,  positioned to serve as an anchor in
your  investment  portfolio.  We employ no leverage,  purchase no derivatives or
employ any other risk-enhancing techniques.

Our staff and portfolio  managers always welcome your comments and  suggestions.
Only  with your  help can we be  certain  that we are  meeting  your  investment
needs--our primary objective. We appreciate your investing with us.

                  With best wishes for the New Year,

                NICHOLAS KAISER,                 PHELPS MCILVAINE,
                 PRESIDENT                         VICE  PRESIDENT, 
                                                       PORTFOLIO MANAGER


*Morningstar's proprietary ratings reflect historical risk-adjusted performance.
The ratings are subject to change each month, and are calculated from a fund's 3
and 5-year average annual returns with sales charge  adjustments  (if any) and a
risk factor that  reflects  performance  relative to three month  Treasury  bill
returns. Ten per cent of the funds in a Morningstar  investment category receive
five stars. From time to time the adviser has waived all or a portion of fees or
expenses,  resulting in higher  returns.  Naturally,  past  performance  may not
indicate future results.
<TABLE>
<CAPTION>
<PAGE>

INVESTMENTS
November 30, 1995

RATING  ISSUER                 COUPON/MATURITY    FACE AMOUNT      MARKET
                                                                    VALUE
---------------------------------------------------------------------------------------------
                                                                                          ---

GENERAL OBLIGATION (2.0)%
<S>                                  <C>          <C>         <C>     
   A    Bannock County Jail          6.00% due    $100,000    $105,966
        Bond                          9/1/2012

HOUSING (11.6%)
  AA    Idaho Housing
        Authority
        Single Fam Mortgage,         6.85% due     110,000     114,695
        B-1                           7/1/2012
  AA    Idaho Housing
        Authority
        Refunding Ser A              6.15% due     250,000     257,950
                                      7/1/2024
  AA    Idaho Housing
        Authority
        Single Fam Mort              6.60% due     125,000     131,718
        Mezz-E-1                      7/1/2011
  AA    Idaho Housing
        Authority
        Single Fam Mort Rev         8.125% due       5,000       5,222
        Ser B1                        7/1/2019
                                     8.00% due      30,000      31,519
                                      1/1/2020
  AA    Idaho Housing
        Authority
        Single Fam Mort SR           7.70% due     60,000      62,791
                                                   -------     ------
        Ser C1                        7/1/2017
        SUB-TOTAL                                  580,000     603,895

IRRIGATION (5.1%)
  AA    Boise Kuna Irr. Dist.        6.00% due     250,000     265,838
                                      7/1/2008

MEDICAL/HOSPITALS (3.6%)
   A    Idaho Health Facility
        St. Alphonsus Med.           6.25% due     175,000     184,216
        Ctr.                         12/1/2012

REAL ESTATE (6.3%)
   A    Idaho Falls
        Redevel. Agency Rev.             8.05%     100,000     112,549
                                  due10/1/2006
                                    8.125% due     100,000     112,940
                                     10/1/2008
  AAA   Idaho Bldg. Authority
        Rev. Ref. Ser C              5.70% due    100,000     104,905
                                                  --------    -------
                                      9/1/2007
        SUB-TOTAL                                  300,000     330,394

ROADS (7.5%)
   A    Payette L.I.D.               7.60% due      30,000      30,593
                                      5/1/2005
   A    Post Falls, Kootenai         6.50% due      10,000       9,963
        County                       4/15/1996
        L.I.D. #91-1                 6.75% due      10,000       9,976
                                     4/15/1997
                                     7.00% due      10,000       9,982
                                     4/15/1998
                                     7.20% due      15,000      14,982
                                     4/15/1999
                                     7.40% due      15,000      14,996
                                     4/15/2000
                                     7.60% due      15,000      15,002
                                     4/15/2001
                                     7.75% due      20,000      20,008
                                     4/15/2002
                                     7.95% due      20,000      20,018
                                     4/15/2003
                                     7.95% due      20,000      20,018
                                     4/15/2004
                                     7.95% due      20,000      20,018
                                     4/15/2005
                                     7.95% due      20,000      20,016
                                     4/15/2006
                                     7.95% due      20,000      20,015
                                     4/15/2007
   A    Post Falls L.I.D.            4.75% due      30,000      29,942
        #91-4                         9/1/1999
                                     5.00% due      30,000      30,092
                                      9/1/2000
                                     5.20% due      35,000      35,223
                                      9/1/2001
                                     5.40% due      35,000      35,077
                                      9/1/2002
                                     5.60% due     35,000      35,084
                                      9/1/2003
        SUB-TOTAL                                  390,000     391,005

SCHOOL (GO'S) (28.6%)
  AA    Ada and Canyon                   6.65%     100,000     109,566
        Counties                  due1/30/2011
        Joint School Dist #2        7.375% due     100,000     111,947
        Meridian                     7/30/2000
  AAA   Bonneville/Bingham           5.40% due     150,000     153,558
        Counties                     7/30/2008
        Jt Schl Dist #93  Ref        5.50% due     100,000     102,178
        Ser A                        7/30/2010
   A    Bonneville County
        School Dist #91              7.00% due     155,000     167,216
                                      8/1/2008
   A    Canyon County                5.90% due      50,000      52,355
                                      8/1/2005
        School Dist. #135            6.00% due      50,000      53,131
                                      8/1/2006
                                     6.00% due      50,000      52,783
                                      8/1/2007
  AAA   Gooding Co.(Wendell)
        School Dist. #232            6.00% due      55,000      58,289
                                      8/1/2008
  AAA   Kootenai County
        School Dist #273             6.00% due     100,000     106,041
                                      8/1/2012
  AAA   Madison County
        School Dist.  #321           5.60% due     150,000     155,496
                                      2/1/2010

  AA    Payette County               6.50% due      80,000      86,514
                                     7/31/2008
        School Dist. #372            6.75% due     155,000     173,017
                                     7/31/2009
                                     6.75% due    100,000     111,128
                                     7/31/2010
        SUB-TOTAL                                1,395,000    1,493,219

STATE EDUCATION (14.2%)
  AAA   Boise St. Univ.              6.20% due     200,000     215,580
                                      4/1/2010
        Fee Revenue                  6.30% due     100,000     108,367
                                      4/1/2014
   A    Idaho State University
        Student Fee                  6.40% due     250,000     268,191
                                      4/1/2014
  AAA   University of Idaho
        Student Fee Rev.             7.70% due      85,000      91,922
                                      4/1/2010
   A    University of Idaho
        Revenue                      6.85% due     50,000      55,547
                                                   -------     ------
                                      4/1/2016
        SUB-TOTAL                                  685,000     739,607

UTILITY-ELECTRIC POWER (1.9%)
  AAA   Idaho Falls
        Elec. Rev.                   6.75% due     100,000     103,205
                                      4/1/2019

UTILITY-SEWER (5.0%)
   A    Hayden Lake L.I.D. #1        6.00% due      60,000      59,991
                                      9/1/2004
   A    Troy Sewer Rev.
                                     6.80% due      10,000       9,995
                                      2/1/1996
                                     6.90% due      10,000      10,121
                                      2/1/1997
                                     7.00% due      10,000      10,256
                                      2/1/1998
                                     7.10% due      10,000      10,449
                                      2/1/1999
                                     7.20% due      10,000      10,541
                                      2/1/2000
                                     7.30% due      10,000      10,593
                                      2/1/2001
                                     7.40% due      10,000      10,672
                                      2/1/2002
                                     7.50% due      10,000      10,659
                                      2/1/2003
                                     7.60% due      10,000      10,676
                                      2/1/2004
                                     7.70% due      15,000      16,076
                                      2/1/2005
                                     7.80% due      15,000      16,016
                                      2/1/2006
                                     7.90% due      15,000      16,019
                                      2/1/2007
        Troy Sewer Rev.              8.00% due      15,000      15,948
        cont'd.                       2/1/2008
                                     8.00% due      20,000      21,416
                                      2/1/2009
                                     8.00% due     20,000      21,408
                                      2/1/2010
        SUB-TOTAL                                  250,000     260,836

UTILITY-WATER SUPPLY (10.9%)
  A-    American Falls Res.          7.25% due      70,000      78,379
                                      5/1/2004
        Ref. Series A               7.625% due     150,000     169,303
                                      5/1/2021
   A    McCall Water Rev.,           6.25% due     200,000     210,249
        Ser 1994                      9/1/2008
   A    McCall Water Revenue        6.375% due      70,000      73,380
                                      9/1/2014
   A    Ucon Water & Sewer           7.75% due     35,000      39,009
                                                   -------     ------
        Rev. Ref.                    12/1/2002
        SUB-TOTAL                                 525,000     570,320
                                                  --------    -------

TOTAL INVESTMENTS (96.7%)                         $4,750,000 $5,048,501
                                                 ==========
 Other Assets (net of liabilities) (3.3%)                      171,813
                                                              -------
Total Net Assets (100%)                                        $5,220,314
                                                              ===========
                                                              
<FN>

These unaudited bond ratings reflect the adviser's  current rating of each bond,
as determined using Standard & Poor's and Moody's
ratings.
</FN>
</TABLE>
<TABLE>
<CAPTION>

FINANCIAL HIGHLIGHTS
Selected data per share of capital stock outstanding throughout the period:
                                                                                 Sept.4, '87
                                                                                 (commence-
                                                                                 ment
                                                                                 of op-
                                                                                 erations)
                                   For Year Ended  November 30                   to
                       ------------- -------- -------- -------- -------- --------------------------
                       1995   1994    1993   1992    1991   1990   1989    1988 Nov.30 '87

NET ASSET VALUE AT
<S>                   <C>    <C>     <C>    <C>     <C>    <C>     <C>     <C>    <C>  
BEGINNING OF PERIOD   $4.76  $5.23   $5.16  $5.10   $5.03  $5.07   $4.98   $5.03  $5.00
   INCOME FROM
   INVESTMENT
   OPERATIONS
   Net investment
   income              0.26  0.27    0.25   0.28    0.30   0.33     0.35    0.35   0.02
   Net gains or
   losses on
   securities
    (both realized
    and unrealized)    0.52 (0.46)   0.12   0.09    0.07  (0.04)  0.09  (0.05)  (0.02)
                       ---- -----    ----   ----    ----  -----   ----  -----   ----- 
 Investment Operations 0.78 (0.19)   0.37   0.37    0.30   0.29   0.44   0.30    0.04
   LESS DISTRIBUTIONS
   Dividends (from
   net investment   
     income         $(0.26)$(0.27) $(0.25)$(0.285)$(0.30)$(0.33)$(0.35) $(0.35)  $(0.01)
                                                                 
   Distributions    
    (from capital
     gains)         0.00   (0.01)  (0.05)   (0.025)  0.00  0.00   0.00    0.00    0.00
                    ----   -----   -----    ------   ----  ----   ----    ----    ----
Total Distributions(0.26)  (0.28)  (0.30)   (0.31)  (0.30) (0.33) (0.35)  (0.35)  (0.01)
NET ASSET VALUE AT                     
END OF PERIOD      $5.28   $4.76   $5.23     $5.16   $5.10  $5.03 $5.07   $4.98   $5.03
                                                                
    
TOTAL RETURN       16.68%  (3.76)%  7.35%    7.49%    7.63  5.94%  9.17%   6.45%  3.20%
RATIOS / 
SUPPLEMENTAL DATA
Net assets ($000),      
end of period     $5,220  $6,841   $7,367   $5,808   $3,803  $2,540  $808   $335   $29
                                                                              
Ratio of expenses 
to average
net assets*       0.75%   0.75%    0.75%    0.75%    0.75%   0.97%    0.90% 0.28% 0.11%
Ratio of net
investment income
   to average net 5.07%  5.28%     4.79%    5.64%   6.08%   %6.74%   6.51%   6.58% 0.56%
   assets*
Portfolio turnover 28%    36%       31%      17%     15%     17%      13%     100%  0%
rate
  
<FN>
   * Not Annualized

For each of the above years,  all or a portion of the expenses  were waived.  If
these costs had not been waived, the resulting increase to expenses per share in
each of the above periods would be $.016, $.007, $.009, $.008, $.02, $.02, $.05,
$.10,  $.19,  and $.01,  respectively.  The increase to the ratio of expenses to
average monthly net assets would be .26%, .14%, .18%, .17%, .54%, 1.01%,  1.25%,
2.24% and .11%,  respectively.  (The accompanying  notes are an integral part of
these financial statements)
</FN>
</TABLE>
<TABLE>
<CAPTION>

STATEMENT OF ASSETS AND LIABILITIES
As of November 30, 1995
ASSETS
     Investments, at value
<S>                                                   <C>       
     Municipal Bonds (cost $4,797,276)                 $5,048,501
     Cash                                                  78,340
     Interest receivable                                   97,090
     Insurance deposit                                       800
                                                             ---
        Total Assets                                  $5,224,731
                                                      ----------
LIABILITIES
     Payable to affiliate                                 4,417
                                                          -----
        Total Liabilities                                 4,417
                                                          -----
NET ASSETS                                            5,220,314
                                                      =========
FUND SHARES OUTSTANDING                                 988,761
ANALYSIS OF NET ASSETS
     Paid in capital (unlimited shares authorized, no
     par value)                                       5,033,109
     Undistributed netinvestment income (loss)              (26)
     Accumulated net realized gain (loss) 
          on investments
                                                        (63,994)
     Unrealized net appreciation
     on investments                                      251,225
                                                         -------
     Net Assets applicable to                         
     Fund shares outstanding                          $5,220,314
                                                      ==========                           
                                                         
NET ASSET VALUE PER SHARE                                  $5.28
</TABLE>
<TABLE>
<CAPTION>

STATEMENT OF OPERATIONS
Year ended November 30, 1995
INVESTMENT INCOME
<S>                                             <C>         <C> 
    Interest income                             $368,984
    Amortization of bond premiums                (12,119)
    Accretion                                      1,154
    Miscellaneous                                    221
                                                  ------
       Gross investment income                              $358,240
EXPENSES
    Investment adviser and administration fee    30,862
    Professional fees                            13,612
    Shareowner servicing                          5,205
    Printing and postage                          4,954
    Filing and registration fees                  2,155
   Other expenses                                 5,618
                                                  -----
    Total gross expenses                          62,406
       Less earnings credits                       (2,041)
       Less advisory fee waived                   (14,048)
                                                  ------- 
    Net expenses                                            46,317
                                                            ------
       Net investment income                                311,923
                                                            -------
NET REALIZED GAIN (LOSS) ON
INVESTMENTS
    Proceeds from sales                         3,446,364
    Less cost of securities sold 
     based on identified cost                   3,510,768
                                                ---------
       Realized
       net loss                                         (64,404)
                                                        ------- 
UNREALIZED GAIN (LOSS) ON INVESTMENTS
    End of period
                                                251,225
    Beginning of period                        (500,262)
                                                ---------
    Increase in unrealized gain for
    the period                                          751,487
                                                        -------
       Net realized and unrealized
       gain on investments                              687,083
                                                        -------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS                                         $999,006
                                                        --------
</TABLE>

(The accompanying notes are an integral part of these financial statements)

<TABLE>

<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS                      Year       Year
                                                         ended      ended
                                                       Nov. 30,   Nov. 30,
                                                          1995       1994
OPERATIONS:
<S>                                                  <C>          <C>     
    Net investment income                            $ 311,923    $381,688
    Net realized (loss) gain on investments            (64,404)     19,224
    Net  increase (decrease) in unrealized
    appreciation                                      751,487   (692,425)
                                                      --------  ---------
    Net  increase (decrease) in net assets            999,006    (291,513)
                                                      -------   -------- 

DIVIDENDS TO SHAREOWNERS FROM:
    Net investment income                              (311,941)  (383,476)
                                                       --------   -------- 
    Capital gains distributions
                                                            -    (20,015)
                                                       -------   -------

FUND SHARE TRANSACTIONS:
    Proceeds from sales of shares
                                                       793,990  2,393,405
    Value of shares issued in reinvestment of
    dividends                                         226,992    287,510
                                                      --------   -------

                                                     1,020,982  2,680,915
    Cost of shares redeemed                          (3,329,049)(2,512,371)
    Net increase (decrease) in net assets from
    share transactions                              (2,308,067)  168,544
                                                    -----------  -------
Total (decrease) in net assets                     (1,621,002) (526,460)

NET ASSETS
    Beginning of period
                                                    6,841,316  7,367,776
                                                    ---------  ---------
    End of period                                  $5,220,314  $6,841,316
                                                    ========== ==========
    (Including undistributed net investment income
    of ($26) for  Nov. 30,1995 and ($8) for Nov.
    30,1994)
Shares of the Fund Sold and Redeemed
    Number of shares sold                              225,327    466,823
    Number of shares issued in reinvestment of
    dividends                                           44,240     57,107
    Number of shares redeemed                         (717,954)  (495,726)
                                                      --------   -------- 
Net Increase (Decrease) in Number of Shares
Outstanding                                          (448,387)    28,204
                                                     ========     ======
</TABLE>

(The accompanying notes are an integral part of these financial statements)

                              DISCUSSION OF FUND PERFORMANCE
                                        (UNAUDITED)
 For the  twelve-month  period ending November 30, 1995, Idaho Tax-Exempt Fund
 returned  shareholders 16.68%. At November 30, the 30-day yield on the Fund was
 4.6% and the share price had risen to $5.28 from $4.76 at the beginning of the
 fiscal year.

Although the bond market enjoyed a substantial  recovery from the bear market of
fiscal 1994,  concerns  about a possible  flat (or flatter)  federal  income tax
meant the municipal bond market maintained a fairly high level of interest rates
relative to taxable  securities.  While this high  relative  yield  presented an
opportunity to buyers of municipal bonds generally, it did restrain somewhat the
rally in price experienced by some issues in the marketplace.

The  primary  objective  of the Fund is income  exempt  from  federal  and Idaho
personal  income taxes,  with the secondary  objective of capital  preservation.
Although Idaho has a relatively  high personal income tax, the fact that its per
capita  outstanding  municipal debt is only  one-third the national  average and
that it has a high income tax means Idaho debt is relatively  dear in the market
because of the excess of demand over supply.  These factors  reduce the yield on
Idaho bonds compared to similar issues of other states,  but also  contribute to
relative stability of principal.

The Fund's  secondary  policy of preservation of capital drives it to maintain a
moderate  portfolio  maturity in the intermediate  5-to-15 year range. While the
Fund's  policies limit price risk normally  associated  with longer  maturities,
when compared to a general bond index,  such as the Lehman  Municipal  Index, or
funds with policies more like the Index, the Fund typically will experience both
less price decline and appreciation than the Index. Though the Fund does not try
to  "beat"  the  Lehman  or  any  other  specific  index,  the  Fund's  returns,
considering lower price fluctuation, compared favorably to that of the Index for
the fiscal year, as shown in the accompanying chart.

The line graph below compares Idaho Tax-Exempt Fund's  performance to the Lehman
Brothers Municipal Bond Index, a broad-based  municipal bond market index. To be
comparable,  the Municipal Index data includes reinvested income (as computed by
Lehman  Brothers  Fixed  Income  Research).  Note that this  graph  compares  an
unmanaged,  expense-free  index to an actively managed fund that has transaction
and other costs and stands ready to buy and sell its securities to  shareholders
on a daily  basis,  as well as  providing  s a wide range of  services  to them.
Additionally, it should be noted that few if any investors are able to invest in
such a portfolio  because of the large  amount of  securities  involved to model
such a portfolio.

Were the Fund to target the Index as an  objective,  the Fund might take greater
risk in a  longer  term  maturity  in its  portfolio  to take  advantage  of the
fluctuation--for  better or for  worse--available in such a portfolio.  However,
maintaining  the stability of capital is an objective of the Fund, so we believe
the Fund has performed well within expectations.

     The graph shows that $10,000  invested in Idaho  Tax-Exempt Fund at the end
of September  1987 would have grown to $17,225 at the end of November  1995.  If
$10,000 could have been invested in the Lehman Brothers  Municipal Bond Index at
the end of September 1987, that would have grown to $20,678.

Date         The Fund     Lehman
                          Index
       Sep-87   $10,000     $10,000
     11/30/88     10679       11391
     11/30/89     11658       12644
     11/30/90     12351       13620
     11/29/91     13294       15019
     11/30/92     14290       16525
     11/30/93     15341       18356
     11/30/94     14763       17392
     11/30/95     17225       20678

(Graph omitted)

NOTES TO FINANCIAL STATEMENTS
Note 1-Organization
Saturna  Investment  Trust,  (formerly  Northwest  Investors  Trust)  Trust (the
"Trust")  was  established  under  Washington  State Law as a Business  Trust on
February  20,  1987.  The Trust is  registered  as a  no-load,  open-end  series
investment  company under the Investment  Company Act of 1940, as amended.  Four
portfolios  have been created to date in addition to Idaho  Tax-Exempt Fund (the
"Fund.") The other four portfolios  distribute through a separate prospectus and
the results of those funds are contained in a separate report.

Note 2--Significant Accounting
Policies
The following is a summary of the significant  accounting  policies  followed by
the Fund.

INVESTMENTS:
Fixed-income  securities  for  which  there  are no  publicly  available  market
quotations  are valued  using a matrix  based on  maturity,  quality,  yield and
similar  factors,  which are compared  periodically  to multiple dealer bids and
adjusted by the adviser under policies established by the Trustees.

The cost of  securities  is the same  for  accounting  and  Federal  income  tax
purposes. Securities transactions are recorded on trade date. Realized gains and
losses are recorded on the identified cost basis.

INCOME AND EXPENSES:
Interest income is reduced by the  amortization of bond premiums,  on a constant
yield-to-maturity basis from purchase date to maturity.

Interest  income  is  increased  by  accretion  only for bonds  underwritten  as
original issue  discounts.  Market discounts are recorded as realized gains upon
disposition.

Expenses incurred by the Trust on behalf of the Fund (e.g.,  professional  fees)
are  allocated  to the Fund and the  other  Funds of the  Trust on the  basis of
relative  daily average net assets.  The Adviser has agreed to certain limits on
expenses, as described below.

INCOME TAXES:
The Fund has elected to be taxed as a  regulated  investment  company  under the
Internal  Revenue  Code and  distribute  substantially  all of its  taxable  net
investment income and realized net gains on investments. Therefore, no provision
for Federal  income  taxes is  required.  Further,  the Fund intends to meet IRS
requirements  for  tax-free  income  dividends,  and  requirements  of the Idaho
Department of Revenue for income dividends free of Idaho state income tax.

DIVIDENDS AND DISTRIBUTIONS TO SHAREOWNERS:
Dividends and distributions to shareowners are recorded on the ex-dividend date.
Dividends are paid daily and distributed on the last business day of each month.
Shareowners electing to reinvest dividends and distributions purchase additional
shares at the net asset value on the payable date.

Note 3--Transactions with Affiliated Persons
Under a contract  approved by share-owners on October 12, 1990,  Saturna Capital
Corporation   provides   investment   advisory   services   and  certain   other
administrative  and distribution  services to conduct the Fund's  business.  For
such  services,  the Fund pays an annual fee equal to .50% of average  daily net
assets.  For the year ended  November 30, 1995,  the Fund incurred  advisory fee
expenses of $30,862.

Saturna  Capital has  volunteered to reimburse the Fund to the extent that total
expenses of the Fund,  (excluding  interest,  brokerage  commissions  and taxes)
exceeds  0.75%  through  November  30,  1995 and .80%  througn  March 31,  1997.
Accordingly,  for the year ended  November  30,  1995,  Saturna  Capital  waived
$14,048 of the advisory fee.

In accordance with the Fund's  agreement with its custodian bank,  National City
Bank, for the year ended November 30, 1995, custodian fees incurred by the Fund,
amounted to $2,041.

Two  trustees,  who also serve as  officers  of the  Trust,  are  directors  and
officers of Saturna Capital Corporation.

The Trust acts as a  distributor  of its own shares,  except in those  states in
which   Investors   National   Corporation  (a  subsidiary  of  Saturna  Capital
Corporation)  is itself  registered as a  broker-dealer  and acts as distributor
without  compensation.  Saturna Capital Corporation acts as shareowner servicing
(transfer) agent for the Fund, for a monthly fee plus certain expenses.  For the
fiscal year ended November 30, 1995, the Fund paid such a fee of $5,205.

All  trustees  have  served to date  without  compensation;  however,  effective
January 1, 1996 the  unaffiliated  trustees  will begin to receive a fee of $100
per meeting  attended  each. On November 30, 1995,  the  trustees,  officers and
their immediate  families as a group owned none of the outstanding shares of the
Fund.

Note 4--Federal Income Taxes
At November 30, 1995,  theFund had capital loss  carryforwards  of $64,404 which
expire in 2003. Prior to their expiration,  such loss  carryforwards may be used
to offset future net capital gains realized for Federal income tax purposes.

Note 5--Investments
At November 30, 1995, the net  unrealized  appreciation  of investments  for the
Fund of  $251,225  comprised  gross  unrealized  gains  of  $259,531  and  gross
unrealized losses of $8,306.

During the year ended  November  30,  1995,  the Fund  purchased  $1,643,866  of
securities and sold/matured $3,446,364 of securities.

                                  REPORT OF
                           INDEPENDENT ACCOUNTANTS
                                           To the Board of Trustees
and Shareowners of
Saturna Investment Trust

In our opinion, the accompanying statement of assets and liabilities,  including
the schedule of  investments,  and the related  statements of operations  and of
changes  in net assets  and the  financial  highlights  present  fairly,  in all
material respects, the financial position of the Idaho Tax-Exempt Fund, a series
of Saturna  Investment Trust,  (formerly  Northwest  Investors Trust;  hereafter
referred to as the "Trust") at November 30, 1995,  the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended, and the financial highlights for each of the six years
in the period then ended,  in  conformity  with  generally  accepted  accounting
principles.  These  financial  statements  and financial  highlights  (hereafter
referred to as "financial  statements")  are the  responsibility  of the Trust's
management;  our  responsibility  is to express  an  opinion on these  financial
statements  based on our  audits.  We  conducted  our audits of these  financial
statements  in accordance  with  generally  accepted  auditing  standards  which
require that we plan and perform the audits to obtain reasonable assurance about
whether the financial  statements  are free of material  misstatement.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements,  assessing the  accounting  principles
used and  significant  estimates made by management,  and evaluating the overall
financial  statement  presentation.  We believe that our audits,  which included
confirmation  of  securities  at November  30, 1995 by  correspondence  with the
custodian  and a broker,  provide a reasonable  basis for the opinion  expressed
above.  The  financial  statements of the Trust for each of the two years in the
period  ended   November  30,  1989  and  for  the  period   September  4,  1987
(commencement  of  operations)  through  November 30, 1987 were audited by other
independent  accountants  whose  report  dated  January  19, 1990  expressed  an
unqualified opinion on those statements.


Seattle, Washington
December 15, 1995

                             IDAHO TAX-EXEMPT FUND,
                    A PORTFOLIO OF SATURNA INVESTMENT TRUST
                                SATURNA CAPITAL
                                  MUTUAL FUNDS
                                  1-800/SATURNA
                                 (800/728-8762)
This report is issued for the information of the shareowners of the Fund.
It is not authorized for distribution to prospective investors unless it is
accompanied or preceded by an effective prospectus relating to the
securities of the Fund. Idaho Tax-Exempt Fund is a series of Saturna
Investment Trust.
                         (GRAPHIC OF IDAHO MAP OMITTED)
                                  ANNUAL REPORT
                               NOVEMBER 30, 1995