SECURITIES AND EXCHANGE COMMISSION  WASHINGTON, DC 20549**FORM N-CSR****CERTIFIED SHAREHOLDER REPORT OF REGISTERED  MANAGEMENT INVESTMENT COMPANIES**  Investment Company Act file number: 811-05071 or 33-13247**SATURNA INVESTMENT TRUST**  (Exact Name of Registrant as Specified in Charter)**1300 N. State Street  Bellingham, Washington 98225-4730**  (Address of Principal Executive Offices, including ZIP Code)  Nicholas F. Kaiser  1300 N. State Street  Bellingham, Washington 98225-4730  (Name and Address of Agent for Service)  Registrant’s Telephone Number- (360) 734-9900  Date of fiscal year end: November 30, 2003  Date of reporting period: November 30, 2003

 

 

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**REPORT TO STOCKHOLDERS**

| Sextant

**Mutual Funds** | (graphic omitted) |
|---------------------------|-------------------|

 

Fellow Shareowners:  Everybody wins! Bonds and stocks both did well in 2003. After threeconsecutive  years of losses, stock markets bounced back nicely in calendar 2003. Fearing  that interest rates will not remain so low, the bond markets marked time and  their big gain years ended.  Buoyed by consumer spending, low interest rates, tax cuts, defense and aidspending,  and a weakening dollar, corporate earnings of companies in the S&P 500Index  set a new record. Their 2003 combined earnings are estimated at $474 billion,  up from $179 billion in 2002. Millions of job cuts kept costs low as consumers  bought cars, houses and electronics. A surging stock market helpedfinancial-services  earnings, while exporters basked in new volume. Rapid economic growth isexpected  to continue well into 2004, and new jobs are finally appearing.  The no-load Sextant Funds are designed to address a broad spectrum ofinvestment  needs. In the up markets of 2003, returns increased with higher risks, just  as would be expected. All stress low operating expenses and employ a"fulcrum"  advisory fee structure that rewards or penalizes Saturna Capital forinvestment  results. For the fiscal year ended November 30, 2003, comparative totalreturns  and percentile Morningstar category rankings (1 is best) are:
Sextant FundTotal Returnvs. MorningstarTotal Return12-mo. Rank (group size)*Short-Term Bond5.00%Short-Term Bonds2.93%8 (276)Bond Income6.52%Long-Term Bonds9.58%62 (73)Growth21.31%Mid-Cap Growth32.65%79 (768)International33.23%Foreign Large Growth24.22%3 (210)
Further information on each Fund is found in the followingsections    of this report. Our portfolio managers welcome your comments andsuggestions.    The entire staff works to minimize operating expenses, which are well below    industry standards. In the footnotes, you will notice another unusualfeature    of the Sextant funds: on average, almost 24% of each Sextant Fund is owned    by the trustees, officers, and their immediate families. We invite you to    invest your money with ours.

**Nicholas Kaiser,*******President*****Phelps McIlvaine,*Vice President***(Manager, Sextant Growth;        Sextant International)(Manager, Sextant Bond Income;        Sextant Short-Term Bond)
*The 12-month Rank shows how each Fund ranks (from 1 best to    100 worst) in its Morningstar peer category for the year ended November 30,    2003 - please see next page for more performance information, or see back    of brochure for Morningstar disclosure.

January 2, 2004
*November        30, 2003 Annual Report**1*
*Additional Performance Information*
**Average Annual Total Returns** (as of12/31/2003)1 year5 years10 years ORSince inception          on 9/28/1995Sextant Growth Fund26.16%6.36%9.42%^Sextant International Fund49.54%5.20%7.95%Sextant Short-Term Bond Fund3.51%5.55%5.60%Sextant Bond Income Fund3.80%6.28%6.14%*Performance data quoted in this report        represents past performance, is before any taxes payable by shareowners,        and is no guarantee of future performance. Mutual fund performancechanges        over time and currently may be significantly lower than stated. Recent        performance and Morningstar rating data is published online at eachmonth’s        end. Please visit saturna.com or call Saturna Capital for currentperformance        figures. Total returns are historical and include change in share value        and reinvestment of dividends and capital gains, if any. Share price,        yield and return will vary and you may have a gain or loss when you sell        your shares. Funds that invest in foreign securities may involve greater        risk, including political and economic uncertainties of foreigncountries        as well as the risk of currency fluctuations.**Morningstar, Inc. is an independent fund performance        monitor. Rankings are determined monthly from total returns byMorningstar,        by category as determined by Morningstar. The overall Morningstar rating        for a fund is derived from a weighted average of the performance figures        associated with its 3-, 5-, and 10-year (if applicable) MorningstarRating.        The average total return for a category is determined by SaturnaCapital,        utilizing the Morningstar database. Results are shown for twelve months        because the Sextant Funds’ performance fees are based on the same        period.*
**REPORT OF INDEPENDENTCERTIFIED            PUBLIC ACCOUNTANTS**

            To the Shareholders and Board of Trustees            Saturna Investment Trust            We have audited the accompanying statement of assets and liabilities            of the Sextant Short-Term Bond Fund, Sextant Bond Income Fund,Sextant            Growth Fund and Sextant International Fund, each a series of theSaturna            Investment Trust, including the schedules of investments as ofNovember            30, 2003, and the related statements of operations for the year then            ended, and the changes in net assets for each of the two years then            ended, and the financial highlights for each of the five years then            ended. These financial statements and financial highlights are the            responsibility of the Trust’s management. Our responsibility            is to express an opinion on these financial statements and financial            highlights based on our audits.             We conducted our audits in accordance with auditing standardsgenerally            accepted in the United States of America. Those standards require            that we plan and perform the audit to obtain reasonable assurance            about whether the financial statements and financial highlights are            free of material misstatement. An audit includes examining, on atest            basis, evidence supporting the amounts and disclosures in thefinancial            statements. Our procedures included confirmation of securities owned            as of November 30, 2003, by correspondence with the custodian and            broker. Our audit also includes assessing the accounting principles            used and significant estimates made by management, as well asevaluating            the overall financial statement presentation. We believe that our            audits provide a reasonable basis for our opinion.             In our opinion the financial statements and financial highlightsreferred            to above present fairly, in all material respects, the financialposition            of Sextant Short-Term Bond Fund, Sextant Bond Income Fund, Sextant            Growth Fund, and Sextant International Fund, as of November 30,2003,            the results of their operations for the year then ended, and thechanges            in their net assets for each of the two years then ended and their            financial highlights for each of the five years in the period then            ended, in conformity with accounting principles generally accepted            in the United States of America.

/s/ TAIT, WELLER &BAKER

            Philadelphia, Pennsylvania            January 8, 2004
*2* *November 30, 2003          Annual Report***(graphic omitted)**SEXTANT        SHORT-TERM BOND FUND** ******INVESTMENTS**   *As of November 30, 2003****Rating*******Issuer******Coupon/Maturity******Face Amount******Market Value*********  ***Banking (11.5%)***   A+Australia & New Zealand Bank6.25% due 2/1/2004$85,000 $85,306ABankers Trust (DB) sub notes8.25% due 5/1/200585,00091,160A+JP Morgan7.625% due 9/15/200480,00083,093  *SUB-TOTAL*250,000 259,559 ***Building Products (3.4%)***   A-Lowe's Companies7.50% due 12/15/200570,00076,832      ***Computer (3.3%)***   AA-Hewlett Packard7.15% due 6/15/200570,00074,364      ***Finance & Insurance (20.3%)***   AAllliance Capital Management5.625% due 8/15/200665,00069,245A+International Finance AIG5.75% due 10/15/200695,000101,257A-Lincoln National Insurance7.25% due 5/15/2005100,000106,915BBB+Sears Roebuck Acc.3.30% due 6/15/2006100,00099,276A-Washington Mutual Financial 8.25% due 6/15/200575,00081,197 ***SUB-TOTAL*435,000 457,890 ***Machinery (12.5%)***   ADeere6.55% due 7/15/200490,000 92,265AEaton 6.95% due 11/15/200485,00088,692A-Rockwell Automation International6.15% due 1/15/200895,000102,533  *SUB-TOTAL*270,000 283,490 ***Medical Drugs (15.7%)***   AAABristol Myers Squibb4.75% due 10/1/200690,00092,666ACardinal Health6.50% due 2/15/200475,000 75,434AAAPfizer5.625% due 2/1/2006100,000106,209A-Wyeth7.90% due 2/15/200575,000 79,745  *SUB-TOTAL*340,000354,054 ***Oil & Gas (4.8%)***   BBB+Union Oil of California7.20% due 5/15/2005100,000 108,018      ***Publishing (2.1%)***   A-Tribune6.875% due 11/1/200645,00048,515      ***Utilities (17.3%)***   AA-Florida Power & Light6.875% due 12/1/200595,000102,952A-Sempra Energy6.95% due 12/1/200592,00097,993AA-Southwestern Bell Telephone6.625% due 7/15/200795,000104,356A-Verizon Wireless5.375% due 12/15/200682,00086,582  *SUB-TOTAL*364,000391,883     **Total Investments (90.9%)****(Cost = $1,991,873)****$1,944,000****$2,054,605**Other Assets (net of liabilities) (9.1%)  204,692**Total Net Assets (100%)**  **$2,259,297****Ratings are the lesser of S&P orMoody's        (unaudited)*   *November        30, 2003 Annual Report*** *3*(Graphic        Omitted)**FINANCIALHIGHLIGHTS** 
**SEXTANTSHORT-TERM          BOND FUND***Selected data per share of capital stock        outstanding        throughout the year***For Year ended November 30,**  **2003****2002****2001****2000****1999****Net asset value at beginning of year** **$5.07****$5.10****$4.95****$4.92****$5.04***Income from investment operations*      Net investment income  0.23 0.27 0.26 0.27  0.26 Net gains or losses on securities (both realized andunrealized) 0.02 (0.02) 0.14 0.03  (0.12)**Total from investment operations**  0.25 0.25 0.40  0.30  0.14 *Less distributions*      Dividends (from net investment income)  (0.23) (0.28) (0.25) (0.27) (0.26)Distributions (from capital gains) -----Total distributions  (0.23) (0.28) (0.25) (0.27) (0.26)**Net asset value at end of year** **$5.09****$5.07****$5.10****$4.95****$4.92****Total Return** **5.00%****4.90%****8.37%****6.20%****2.88%**       Ratios / Supplemental Data      Net assets ($000), end of year $2,259$2,177$2,189$2,555 $1,795 Ratio of expenses to average net assets* 0.60%0.93%0.51%0.61%0.47%Ratio of net investment income to average net assets 4.47%5.23%5.45%5.45%5.22%**Portfolio turnover rate********22%****28%****28%****12%****21%***For each of the above years, all or aportion        of the operating expenses were waived. If costs had not been waived, the        resulting increase to the ratio of expenses to average monthly netassets        would be .57, .21%, .43%, .41%, and .57%, respectively.
**STATEMENT OFASSETS          AND LIABILITIES**
*As of November 30, 2003*****    **Assets**   Bond investments (Cost $1,991,873) $2,054,605Cash 170,017Interest Receivable 35,579 Total Assets$2,260,201  **Liabilities** Other Liabilities 904 Total Liabilities904  **Net Assets** $2,259,297  **Fund shares outstanding** 443,627  **Analysis of Net Assets** Paid in Capital (unlimited shares authorized, without par        value) 2,226,088Accumlated net realized loss (29,523)Unrealized net appreciation on investments 62,732 Net Assets applicable to Fund shares outstanding$2,259,297**Net Asset Value, Offering and Redemption price pershare** **$5.09**
*(The accompanying notes are an integral part of thesefinancial    statements)*
*4* *November 30, 2003          Annual Report*****SEXTANTSHORT-TERM        BOND FUND** 
**STATEMENT OFOPERATIONS**(Graphic          Omitted)****  *For the year ended November 30, 2003***Investment Income**   Interest income $131,034Amortization of bond premium (19,444Accretion 3,980 Gross investment income$115,570  **Expenses** Investment adviser and administration fees 15,979Professional fees 3,712Filing and registration fees 2,790Custodian fees 1,983Insurance 1,149Other expenses 613Printing and postage 558Total gross expenses 26,784Less adviser fees waived (11,092)Less custodian fees waived (1,983)Net expenses 13,709 Net investment income101,861  **Net realized gain on investments** Proceeds from sales 464,965Less: cost of securities sold based on identifiedcost 458,769 Realized net gain6,196  **Unrealized gain on investments** End of year 62,732Beginning of year 63,527Decrease in unrealized gain for the year (795) Net realized and unrealized gain5,401**Net increase in net assets resulting fromoperations** **$107,262**
*(The accompanying notes are an integral part of thesefinancial    statements)*
*November 30, 2003Annual        Report*** *5*****(Graphic        Omitted) **STATEMENT OF        CHANGES IN NET ASSETS** 
**SEXTANTSHORT-TERM          BOND FUND****** **Year ended****Year ended** **Nov. 30, 2003****Nov. 30, 2002****INCREASE (DECREASE) IN NET ASSETS**  **From Operations**  Net investment income$101,861$115,149Net realized gain on investments6,1961,414Net decrease in unrealized appreciation(795)(12,326)Net increase in net assets107,262104,237 **Dividends to shareowners from**Net investment income(101,962)(118,239) **Fund Share transactions**Proceeds from sales of shares551,793439,793Value of shares issued in reinvestment ofdividends100,884117,683 652,677557,476Cost of shares redeemed(575,737)(555,278)Net increase in net assets76,9402,198**Total increase (decrease) in net assets****$82,240****$(11,804)** **NET ASSETS**Beginning of year2,177,0572,188,861End of year$2,259,297$2,177,057 **Shares of the fund sold and redeemed**Number of shares sold107,30586,066Number of shares issued in reinvestment of dividends19,60323,087 126,908109,153Number of shares redeemed(112,516)(109,001)**Net increase in number of shares outstanding****14,392****152**
*(The accompanying notes are an integral part of thesefinancial    statements)*
**DISCUSSION        OF SEXTANT SHORT-TERM BOND FUND PERFORMANCE**
         
(unaudited)
**FISCAL YEAR2003**
*6* *November 30, 2003          Annual Report***
**FACTORS AFFECTINGPERFOMANCE**Over the last twelve months, the Federal Reserve maintained very lowinterest    rates to boost the economy. Long US Treasury rates stayed below fivepercent,    unleashing more mortgage refinancing and home buying. Credit spreadsnarrowed    considerably in 2003 as economic growth reemerged. 2002’s general fear    of corporate accounting problems disappeared, and investor confidence was    restored. The Fund’s portfolio of higher-coupon short-maturitycorporate    bonds helped total return. The Fund’s average maturity continued atjust    over 2.0 years, with an average S&P quality rating of A.

**LOOKINGFORWARD**    We expect the US economy to grow 4% to 6% in 2004, and corporate profits to    increase 15% to 20%. Focused on national elections in November, governments    will be stimulative. Low mortgage rates and low prices have supportedconsumer    spending, however we look for manufacturing and capital spending to be the    engine of growth in 2004. The collapse of the US dollar threatens futureinflation,    and we expect the Federal Reserve to slowly push short-term interest rates    up. Despite assurances to the contrary, we expect monetary policy willbecome    tighter. The Fund will continue to overweight high grade corporate notes,    which should provide another year of positive real returns.

**MANAGEMENT FEECALCULATIONS**    The Sextant Short-Term Bond Fund calculates part of its management fee based    on a comparison of the Fund’s return to the average return of theMorningstar    category Short-Term Bond. The Fund’s 12-month return (5.00%) bettered    by more than two percent that of the Morningstar average (2.93%) on November    30, 2003. Therefore, a performance bonus adjustment of 0.20% was added to    the basic 0.60% annual management fee for the month of December 2003. The    Fund’s total expense ratio decreased to 0.60%, reflecting theadviser’s    voluntary expense cap. 

**COMPARISON TOINDEX**    Comparison of any mutual fund to a market index must be made bearing in mind    that the Index is unmanaged, and expense-free. The graph below compares$10,000    invested in the Fund at its inception in September 1995, compared to asimilar    amount invested in the Salomon Brothers Gov/Corp Investment Grade Bond Index    for maturities between one and three years. The graph shows that a $10,000    investment made on September 1995 would have risen to $15,592 in the Fund    and $16,232 in the Index. The returns shown do not reflect the deduction of    income taxes that an investor could pay on income received or the sale of    profitable investments. 

 

**Sextant Short-Term Bond Fund vs. Salomon Gov/Corp 1-3 yr.(unaudited)**

*(graph omitted)*

 

 
*November 30, 2003Annual        Report*** *7***INVESTMENTS** 
****SEXTANT BOND          INCOME FUND****(Graphic          Omitted)   *As of November 30, 2003****Rating*******Issuer******Coupon/Maturity******Face Amount******Market Value***     ***Banking (9.9%)***   A+Chase Manhattan7.125% due 6/15/2009$50,000 $56,240A+Citicorp7.25% due 10/15/201150,000 57,501A-Comerica Bank7.125% due 12/1/201350,000 54,942A+Norwest Financial6.85% due 7/15/200950,000 56,732  *SUB-TOTAL*200,000 225,415      ***Building Products (3%)***   BBB+Masco Corporation7.125% due 8/15/201360,00068,938      ***Chemicals (2.4%)***   AAir Products & Chemicals8.75% due 4/15/202150,00055,566      ***Diversified Financial Services (3.2%)***   AAAGeneral Electric Capital 8.125% due 5/15/201260,00072,332      ***Electric Utilities (2.5%)***   A-Commonwealth Edison7.50% due 7/1/201350,000 58,072      ***Electronics (5.1%)***   A-Koninlijke Phillips Electronics 7.25% due 8/15/201350,000 56,797A-Sempra Energy7.95% due 8/15/201050,00058,163  *SUB-TOTAL*100,000114,960      ***Food (8.7%)***   BBB+Conagra7.875% due 9/15/201050,000 59,112A+Hershy Foods6.95% due 8/15/201250,00057,056A-HJ Heinz6.00 % due 3/15/201275,00080,812  *SUB-TOTAL*175,000196,980      ***Insurance (10.7%)***   A+Allstate7.50% due 6/15/201350,000 59,025AProgressive 7.00% due 10/1/201375,00085,534A+XL Capital6.50% due 1/15/201290,00098,623  *SUB-TOTAL*215,000243,182      ***Investment Finance (5%)***   AA-Morgan Stanley Dean Witter6.75% due 10/15/201350,000 54,147AA+Paine Webber Group7.625% due 2/15/201450,000 58,472  *SUB-TOTAL*100,000 112,619*8* *November 30, 2003          Annual Report*****INVESTMENTS** 
****SEXTANT BOND          INCOME FUND****(Graphic          Omitted)***Rating*******Issuer******Coupon/Maturity******Face Amount******Market Value***      ***Machinery (5.7%)***   A+Caterpillar9.375% due 8/15/2011$40,000$51,701A+Dover6.25% due 6/1/200870,00076,901  *SUB-TOTAL*110,000128,602      ***Medical Supplies (2%)***   A+Becton Dickinson7.15% due 10/1/200940,000 45,341      ***Oil & Gas (5.5%)***   ABaker Hughes6.00% due 2/15/200970,00076,736A+Texaco Capital8.625% due 6/30/201040,000 48,424  *SUB-TOTAL*110,000125,160      ***Retailing (10.3%)***   ADayton Hudson (Target Stores)10.00% due 1/1/201150,000 63,691ALowe's Companies8.25% due 6/1/201050,000 60,567AMay Department Stores8.00% due 7/15/201250,000 57,068AAWal-Mart Stores7.25% due 6/1/201345,00052,723  *SUB-TOTAL*195,000 234,049      ***Telecommunications (2.4%)***   A+GTE6.90% due 11/1/200850,000 55,740      ***Transportation (6.1%)***   ASouthwest Airlines6.50% due 3/1/201275,00080,753A-US Freightways 8.50% due 4/25/201050,000 57,850  *SUB-TOTAL*125,000 138,603      ***US Government (10.9%)***   AAAUS Treasury Bond5.50% due 2/15/2008225,000246,867     ***Total Investments (93.4%)*****(Cost = $1,953,310)****$1,865,000****$2,122,426**Other Assets (net of liabilities) (6.6%)  149,697***Total Net Assets (100%)***  **$2,272,123**    *Ratings are the lesser of S&P or Moody's (unaudited)   
 
*November 30, 2003Annual        Report*** *9*
 
******FINANCIAL HIGHLIGHTS** 
**SEXTANT BONDINCOME          FUND**(graphic          omitted)Selected data per share of capital stock outstanding         throughoutthe year**For Year Ended November 30,**  **2003****2002****2001****2000****1999****Net asset value at beginning of year** **$4.97****$4.81****$4.56****$4.59****$5.00**Income from investment operations      Net investment income  0.22 0.26 0.30 0.29  0.30 Net gains or losses on securities (both realized andunrealized)  0.10 0.16 0.25 (0.03) (0.41)Total from investment operations  0.32 0.42 0.55 0.26  (0.11)*Less distributions*      Dividends (from net investment income)  (0.22) (0.26) (0.30) (0.29) (0.30)Distributions (from capital gains)  -  -  -  - -Total distributions  (0.22) (0.26) (0.30) (0.29) (0.30)**Net asset value at end of year********$5.07****$4.97****$4.81****$4.56****$4.59****Total return********6.52%****9.02%****12.40%****6.05%****(2.20)%**       Ratios/supplemental data      Net assets ($000), end of year  $2,272 $2,105 $1,965 $1,505  $885 Ratio of expenses to average net assets* 0.97%0.72%0.34%0.35%0.39%Ratio of net investment income to average net assets 4.29%5.40%6.71%6.58%6.31%**Portfolio turnover rate********0%****29%****30%****0%****20%***For each of the above years, all or a portion of theoperating        expenses were waived. If these costs had not been waived, the resulting        increases to the ratio of expenses to average monthly net assets would        be .18%, .34%, .72%, .64%, and .66%, respectively. 
**STATEMENT OFASSETS          AND LIABILITIES***As of November 30, 2003*       **Assets**   Bond investments (cost $1,953,310) $2,122,426Cash 111,036Interest receivable 37,917Insurance reserve premium 1,221  Total Assets$2,272,600**Liabilities** Other Liabilities 477 Total Liabilities477**Net Assets** **$2,272,123****Fund Shares Outstanding** 448,182**Analysis of Net Assets** Paid in capital (unlimited shares authorized, without par        value) 2,136,847Accumlated net realized loss  (96,696)Unrealized net appreciation on investments 169,117 Net Assets applicable to Fund shares outstanding$2,272,123**Net Asset Value, Offering and Redemption price pershare******  **$5.07***(The accompanying notes are an integral part of thesefinancial  statements)**10* *November 30, 2003          Annual Report***(graphicomitted)**SEXTANT BOND INCOME FUND** 
**STATEMENT OFOPERATIONS****** *For the year ended November 30, 2003***Investment income**   Interest income $129,810Amortization of bond premium (11,092)Miscellaneous income 171 Accretion 112 Gross investment income$119,001**Expenses** Investment adviser and administration fees 15,620Professional fees 3,949Filing and registration fees 3,550Insurance 1,151Printing and postage 650Custodian fees 641Other expenses 588Total gross expenses 26,149Less adviser fees waived (3,530)Less custodian fees waived (641)Net expenses 21,978 Net investment income97,023**Net realized gain on investments** Proceeds from sales -Less cost of securities sold (based on identified cost) - Realized net gain-**Unrealized gain on investments** End of year 169,117Beginning of year 123,383Increase in unrealized gain for the period 45,734 Net realized and unrealized gain 45,734**Net increase in net assets resulting from operations************$142,757**
 
**STATEMENT OFCHANGES      IN NET ASSETS** 
      **Year ended****Year ended** **Nov. 30, 2002****Nov. 30, 2002****INCREASE IN NET ASSETS**  ***From Operations***  Net investment income$97,023$106,916Net realized loss on investments-(14,253)Net increase in unealized appreciation45,73474,471Net increase in net assets 142,757167,134 ***Dividends to shareowners from***Net investment income(97,200)(107,024) ***From tund share transactions***Proceeds from sales of shares187,626365,971Value of shares issued in reinvestment of dividends91,934103,671 279,560469,642Cost of shares redeemed(158,167)(389,165)Net increase in net assets 121,39380,477**Total increase in net assets****$166,950****$140,587** **NET ASSETS**Beginning of year2,105,1731,964,586End of year$2,272,123$2,105,173 **Shares of the fund sold and redeemed**Number of shares sold36,68775,292Number of shares issued in reinvestment of dividends17,85121,389 54,53896,681Number of shares redeemed(30,137)(80,967)**Net increase in number of shares outstanding****24,401****15,714***(The accompanying notes are an integral part of thesefinancial  statements)**November 30, 2003 Annual      Report*** *11***DISCUSSION      OF SEXTANT BOND INCOME FUND PERFORMANCE**
(unaudited)
**FISCAL YEAR 2003**  For the fiscal year ending November 30, 2003, the Sextant Bond Income Fundreturned  6.52%. At the end of the fiscal year, the Fund ranked in the top 62% of the  73 funds in the Morningstar “Long-term Bond” category and heldMorningstar’s  medium “3-star” rating (judged against 58 long-term bond funds). At  the end of five years, the Fund had provided a 6.27% annualized total return  and ranked in the top 33% of 47 funds in its Morningstar category. TheFund’s  most recent thirty-day SEC current yield is 4.01%, less than the 4.60% at the  end of last year. This reflects lower market rates and a shorter averagematurity.  The Fund reduced its average portfolio maturity substantially during the year  to 7.4 years, and maintained its average S&P credit quality rating of A.  

**FACTORS AFFECTING PASTPERFORMANCE**  Under normal circumstances, the Fund’s policy is to maintain adollar-weighted  average maturity of ten years or more. However, with interest rate levelslower  than they have been in over 40 years, the price risk of holding very long-term  bonds is excessive in light of the Fund’s capital preservation goal.While  inflation is not yet evident, the Fund’s average effective maturity is  conservatively being kept to less than 8 years. While we were early inreducing  the average maturity, the Fund is now well-protected should the expected rise  in interest rates materialize.  The intransigent US economy kept Federal Reserve monetary policy in anaccommodative  posture all year. Investment grade credits generally outperformed USTreasuries  with similar maturities. The Fund’s portfolio remains overwieght ininvestment  grade corporate bonds. This position boosts total return over governmentissues.  The resurgence of the eocnomy and the improvement in stock prices recently has  exerted upward pressure on interest rates and downward pressure on bondprices.

**LOOKING FORWARD**For 2004, we expect 10-year US Treasury rates will rise slowly from 4.2%  to around 5.0%. The real rate of return (after inflation adjustment) hasalready  increased from around 1.4% at the end of 2002 to 3.0%. We expect the USeconomy  to grow 4-6% in 2004 and corporate profits to increase 15 to 20%. Low mortgage  rates and low prices supported consumer spending and the economy in 2003.However,  we look for manufacturing and capital spending to be the engine of growth in  2004. We expect the Federal Reserve Bank to push short-term interest rates up  slowly in the second half of the year and investment grade spreads to narrow.  The Fund will continue to overweight high grade corporate notes over otherinstruments.  Commodity prices are rising, but inflation remains absent. The economicrecovery,  now well underway, has yet to cause higher interest rates. This still leaves  investors with an extended period of time that is favorable for investing in  investment grade corporate notes and bonds. As ten-year rates climb over5.25%,  the Fund is prepared to reinvest at these higher yields and extend theportfolio  maturity. Investment grade spreads are narrow, but we do not expect thissector  to underperform government issues during the coming year. 
*12* *November 30, 2003        Annual Report***
**MANAGEMENT FEECALCULATIONS**  The Sextant Bond Income Fund calculates its management fee based on acomparison  of the Fund’s return to the return of Morningstar’s “Long-term  Bond” category. This category consists of mutual fund portfolios that“focus  on corporate and other investment grade issues with an average duration ofmore  than six years or an effective average maturity of more than ten years.”  The Fund’s +6.52% 12-month return was below that of the index (+9.58%)  on November 30, 2003. Therefore, the basic 0.60% management fee was decreased  by the maximum amount of 0.20%, to 0.40%, for the month of December 2003because  the Fund underperformed its benchmark index by more than 2%. The Fund’s  total expense ratio increased to 0.97%, reflecting performance bonsuses earned  earlier in the year.

**COMPARISON TOINDEX**  Comparison of any mutual fund to a market index must be made bearing in mind  that the index is unmanaged, and expense-free. Conversely, the fund will (1)  be actively managed, (2) have an objective other than mirroring the index,such  as limiting risk, (3) bear transaction and other costs, (4) stand ready to buy  and sell its securities to shareowners on a daily basis, and (5) provide awide  range of services. The graph below compares $10,000 invested in the Fund at  its inception, compared to a similar amount invested in The Salomon Brothers  Broad Investment-Grade Bond Index. The graph shows that the investment at the  beginning of November 1993 would have risen to $18,149 in the Fund and $19,508  in the Index. The September 1995 changes in this Fund’s investment policy  limit the usefulness of this comparison. The returns shown do not reflect the  deduction of income taxes that an investor could pay on income received or the  sale of profitable investments. 

 

**Sextant Bond Income Fund vs. Salomon Broad Investment Grade  Bond Index (unaudited)**

*(graph omitted)*

 
*November 30, 2003 Annual      Report*** *13***INVESTMENTS** **SEXTANTGROWTH        FUND**(graphic omitted)  *As of November 30, 2002* ***Issue******Number of Shares******Cost******Market Value******Common Stocks (85.7%)*********************    ***Banking (10.2%)***   Convergys* 2,500 $51,926 $38,350Frontier Financial 4,000  90,207  137,120Washington Mutual 6,750 44,124  309,127 *SUB-TOTAL* 186,257 484,687***Communications (1.3%)***   Sprint (FON Group)4,00048,15259,960    ***Computers (16.3%)***   3 Com*10,00051,89174,800Adobe Systems 4,800  50,490  198,288Apple Computer* 7,000 132,046 146,370Earthlink*8,00062,44876,320Intuit* 3,000 131,758 150,840Oracle*  8,000  28,059 96,160Phoenix Technologies Ltd.* 3,062  29,149 26,701 *SUB-TOTAL* 485,841 769,479***Construction (7.3%)***   Lowe's Companies4,000135,141233,200Weyerhaeuser 2,000  93,867  114,000 *SUB-TOTAL* 229,008 347,200***Electronics (6.2%)***   Advanced Micro Devices* 10,000 41,708 179,800Agilent Technologies* 4,000 108,894 113,120 *SUB-TOTAL* 150,602 292,920***Food (2.5%)***   Performance Food Group*3,00096,917117,930    ***Hotels & Motels (1.6%)***   Westcoast Hospitality* 15,000 111,771 73,500    ***Investments (5%)***   Schwab (Charles) 20,415 9,117 236,814    ***Machinery (.9%)***   Regal-Beloit  2,000  52,106  41,300    ***Medical (20.9%)***   Affymetrix* 2,000  26,863 49,340Amgen*2,64034,598152,117Barr Laboratories*3,000159,489247,620Bristol-Myers Squibb3,00079,12179,050Caremark Rx* 3,000 60,125 80,100Ligand Pharmaceuticals* 5,000  56,429 66,300Lilly (Eli) 800  77,567  54,848Pharmaceutical Product Development* 9,000 80,608 266,490 *SUB-TOTAL* 574,800 995,865***Metal Ores (1.8%)***   Phelps Dodge* 1,330  76,218  84,694    ***Oil &Gas (1.5%)***   Noble* 2,000  14,212  69,160    ***Publishing (1.3%)***   Wiley (John) & Sons, Class A 2,400  47,112  62,400*14* *November 30, 2003        Annual Report*****INVESTMENTS** **SEXTANTGROWTH        FUND**(graphic omitted)***Issue******Number of Shares******Cost******Market Value***    ***Retail (2.7%)***   Bed Bath & Beyond 3,000 $100,052 $126,720****  ***Transportation (2.3%)***   Southwest Airlines 6,000 90,163 107,880    ***Utilities (3.9%)***   FL Group 1,500 87,711 95,325Idacorp3,00078,28788,200 *SUB-TOTAL*165,998183,525    ***Total Investments (85.7%)*** **$2,438,326****$4,054,034**Other Assets (net of liabilities) (14.3%)   678,042***Total Net Assets (100%)***  **$4,732,076**    *Non-income producing   
 
 *Trustees and Officers (unaudited)* 
**Name and (age)        Address**
**Position(s) held with      Trust and Length of       Time Served****Principal Occupation(s)       during past 5 Years****Number of Portfolios in      Fund Complex      overseen by Trustee****Other Directorships      Held by Trustee****INDEPENDENT TRUSTEES**A. Herbet Ershig (65)      22 Shorewood Drive      Bellingham, WA 98225Independent Trustee        since 1997President (now retired), Ershigs, Inc.        (industrial fabrication)FiveNoneGary A. Goldfogel (45)      1500 N. State Street      Bellingham, WA 98226Independent Trustee        since 1995Medical Examiner (pathologist)        Owner, Avocet Environmental Testing (laboratory)FiveNoneJohn E. Love (71)      1002 Spokane Street      Garfield, WA 99130Independent Trustee        since 1987Owner, J.E. Love Co., (agricultural equipmentmanufacturer)FiveNoneJohn S. Moore (72)      346 Bayside Road      Bellingham, WA 98225Independent Trustee        since 1993Professor (now retired), College of Business and Economics,      Western Washington UniversityFiveNone**INTERESTED TRUSTEES**Nicholas F. Kaiser, CFA (57)      1300 N. State Street      Bellingham, WA 98225President and Trustee        since 1989President, Saturna Capital Corporation        President, Saturna Brokerage ServicesSevenAmana Mutual Funds Trust**OFFICERS WHO ARE NOT TRUSTEES**Phelps S. McIlvaine (50)      1300 N. State Streeet      Bellingham, WA 98225Vice President        since 1994Vice President, Saturna Capital Corporation        Treasurer, Saturna Brokerage ServicesN/AN/AChrisopher R. Fankhauser (31)      1300 N. State Street      Bellingham, WA 98225Treasurer        since 2002Manager of Operations, Saturna Capital CorporationN/AN/AEthel B. Bartolome (31)      1300 N. State Street      Bellingham, WA 98225Secretary        since 2001Corporate Administrator, Saturna Capital Corporation [since      2000]       Administrator, Cytel Corporation [1994-1999]N/AN/ATerm of Office: Each Trustee serves for thelifetime      of the Trust or until he dies, resigns, is removed, or not re-elected by      the shareowners. Each officer serves a one-year term subject to annualreappointment      by the Trustees.      Mr. Kaiser is an interested person of the Trust by reason of his positions      with the Trust's adviser and underwriter. Mr. McIlvaine is the primarymanager      of the Fund's portfolio. Saturna Capital Corporation is the Fund'sadvisor,      and Saturna Brokerage Services, Inc. is the distributor.*November 30, 2003 Annual      Report*** *15***FINANCIALHIGHLIGHTS** 
****SEXTANT GROWTH        FUND****(graphic        omitted)Selected data per share of capital stock outstanding      throughout the year**For Year Ended November 30,**  **2003****2002****2001****2000****1999****Net asset value at beginning of year** **$10.64****$11.90****$13.16****$12.68****$9.29**Income from investment operations      Net investment income  (0.04) (0.05) (0.02) (0.07) (0.06)Net gains or losses on securities (both realized andunrealized)  2.31 (1.21) (1.24) 1.36 4.26Total from investment operations  2.27 (1.26) (1.26) 1.29 4.20*Less distributions*      Dividends (from net investment income)  - - - - (0.14)Distributions (from capital gains)  - - - (0.81) (0.67)Total distributions  - - - (0.81) (0.81)**Net asset value at end of period********$12.91****$10.64****$11.90****$13.16****$12.68****Total Return********21.31%****(10.51)%****(9.57)%****10.16%****44.76%**Ratios / Supplemental Data      Net assets ($000), end of year $4,732$3,373$3,792$3,862 $3,116 Ratio of expenses to average net assets* 1.14%1.11%0.78%1.05%1.12%Ratio of net investment income to average net assets (0.40)%(0.48)%(0.18)%(0.51)%(0.50)%**Portfolio turnover rate********12%****15%****8%****20%****28%***For each of the above years, all or a portion of theoperating      expenses were waived. If these costs had not been waived, the resulting      increases to the ratio of expenses to average monthly net assets would be      .06%, .06%, .06%, .06%, and .09%, respectively. ****
**STATEMENT OF ASSETS        AND LIABILITIES***As of November 30, 2003*       **Assets** Investments (cost $2,438,326) $4,054,034Cash 642,495Receivable for security sales 37,846 Dividends receivable 2,868Insurance reserve premium 1,214****Total Assets$4,738,457**Liabilities** Payable to adviser 3,959Other Liabilities 2,422****Total Liabilities6,381**Net Assets** **$4,732,076****Fund Shares Outstanding** 366,404**Analysis of Net Assets** Paid in Capital (unlimited shares authorized, without par      value) 3,147,746Accumlated net realized loss (31,379)Unrealized net appreciation on investments 1,615,709****Net Assets applicable to Fund shares outstanding$4,732,076**Net Asset Value, Offering and Redemption price pershare** **$12.91**
*(The accompanying notes are an integral part  of these financial statements)*
*16* *November 30, 2003        Annual Report***(GraphicOmitted)**SEXTANT GROWTH FUND** 
**STATEMENT OFOPERATIONS****** ***For the year ended November 30, 2003*****Investment income**   Dividend income $28,193Miscllaneous income 109****Gross investment income$28,302**Expenses** Investment adviser and administration fees 31,950Professional fees 5,376Filing and registration fees 2,790Custodian fees 2,282Insurance 1,710Other expenses 945Printing and postage 888Total gross expenses 45,941Less custodian fees waived (2,282)Net expenses 43,659****Net investment loss(15,357)**Net realized gain on investments** Proceeds from sales 422,958Less cost of securities sold (based on identified cost) 393,941****Realized net gain29,017**Unrealized gain on investments** End of year 1,615,709Beginning of year 800,316Increase in unrealized gain for the year 815,393 Net realized and unrealized gain844,410**Net increase in net assets resulting from operations************$829,053****STATEMENT      OF CHANGES IN NET ASSETS** 
******** **Year ended****Year ended** **Nov. 30, 2003****Nov. 30, 2002****INCREASE (DECREASE) IN NET ASSETS*****From Operations***Net investment loss$(15,357)$(17,391)Net realized gain (loss) on investments29,017(10,677)Net increase (decrease) in unealized appreciation815,393(372,034)Net increase (decrease) in net assets 829,053(400,102)*******Dividends to shareowners from*****Net investment income**--*******From fund share transactions***Proceeds from sales of shares764,452366,963Value of shares issued in reinvestment of dividends-- 764,452366,963Cost of shares redeemed(234,506)(385,297)Net increase (decrease) in net assets 529,946(18,334)**Total increase (decrease) in net assets****$1,358,999****$(418,436)********NET ASSETS**Beginning of year3,373,0773,791,513End of year$4,732,076$3,373,077******Shares of the fund sold and redeemed**Number of shares sold70,50932,585Number of shares issued in reinvestment of dividends--****70,50932,585Number of shares redeemed(21,038)(34,371)**Net increase (decrease) in number of sharesoutstanding****49,471****(1,786)**
*(The accompanying notes are an integral part of these financialstatements)*
*November 30, 2003 Annual      Report*** *17***DISCUSSION      OF SEXTANT GROWTH FUND PERFORMANCE**
(unaudited)
**FISCAL YEAR2003**  For the fiscal year ending November 30, 2003, the Sextant Growth Fund gained  21.31%. Stock prices of smaller companies, generally down the most over the  last four years, bounced back sharply during 2003. For the fiscal year, the  broad S&P 500 Index gained 15.04%, while the smaller-company NASDAQComposite  Index jumped 33.24%. At the end of the fiscal year, the Fund ranked in the top  79% of the 768 funds in the Morningstar Mid-cap Growth category. At the end  of the last five years, the Fund had provided a 9.38% average annualized total  return and ranks in the top 17% of 385 funds in its Morningstar peercategory*.  At November 30, 2003, the Fund held Morningstar’s above-average“4-star”  rating (judged against 606 Mid-cap Growth funds)*.   The volatility, risks and returns of the stock market continue. The poor stock  market performances in 2000, 2001 and 2002 were reversed in 2003 and stocks  provided investors with strong investment returns. Remember, a long-termapproach  is the best opportunity to prosper: the Fund has provided almost 10% average  annualized total return (+9.91%) for the last 10 fiscal years.

**FACTORS AFFECTING PAST  PERFORMANCE**  The economy in 2003 got better and better, buoyed by consumer spending, tax  cuts, and a weakening dollar. It was a “perfect storm” where every  factor, even unpopular foreign wars, worked to the country’s economicbenefit.    The Fund seeks long-term growth through investment in common stocks of U.S.  companies. It generally follows a value investment approach, favoringcompanies  with good fundamentals and relatively low price/earnings ratios. This year's  market recovery favored stocks of smaller companies and technology, which had  declined the most in the three-year bear market that ended in the spring.

**LOOKING FORWARD**  Stocks ultimately reflect their underlying business values. While pricesrallied  in 2003, after their weak performances for three years, we feel many stocks  are still attractively priced. Growth of the U.S. economy is expected at 4%  to 6% in 2004, as low interest rates boost consumer confidence, spending and  investment. Corporate profits should raise 15% to 20%, and employment should  grow quickly.

**MANAGEMENT FEECALCULATIONS**  The Sextant Growth Fund calculates part of its management fee based on acomparison  of the Fund’s return to the average return in Morningstar's“Domestic  Growth” category. At November 30, 2003, the one-year return for thiscategory  average was +20.89%. Because the Fund's 12-month return outperformed thisaverage  by less than 1% at November 30, 
**18** *November 30, 2003        Annual Report***
2003, the adviser earned no bonus or penalty fee for the month  of December 2003. The Fund’s total expense ratio, 1.14% was littlechanged  from the prior year. Like all mutual funds, Sextant Growth Fund’s annual  performance results are only stated after deduction of operating expenses. The  Fund is purchased directly by investors without any sales charges, whicheliminated  the risk of late trading and other ethical lapses discovered at somebroker-distributed  equity mutual funds during 2003.

**COMPARISON TOINDEX**  The line graph compares Sextant Growth Fund's performance to that of abroad-based  stock market index, the Standard & Poor's 500 Index. Comparison of anymutual  fund to a market index must be made bearing in mind that the index isunmanaged,  and expense-free. Conversely, the fund will (1) be actively managed, (2) have  an objective other than mirroring the index, such as limiting risk, (3) bear  transaction and other costs, (4) stand ready to buy and sell its securities  to shareholders on a daily basis, and (5) provide a wide range of services.  The graph below compares $10,000 invested in the Fund at November 30, 1993(ten  years ago), compared to a similar amount invested in Standard & Poor's 500  Index. The graph shows that the investment in the Fund would have risen to$25,720  and $27,468 in the Index. The 1995 changes in this Fund’s investmentobjectives  and policies limit the usefulness of this comparison. The returns shown do not  reflect the deduction of income taxes that an investor could pay on incomereceived  or the sale of profitable investments. 

 

**Sextant Growth Fund vs. S&P 500 Index(unaudited)**

*(graph omitted)*

 
**November      30, 2003 Annual Report**** *19*******INVESTMENTS** 
**SEXTANTINTERNATIONAL        FUND**(Graphic        Omitted)   *As of November 30, 2003****Issue******Number of Shares******Cost******Market Value******Country******Common Stocks (91.9%)********************************* ***Aircraft (3.1%)********* Embraer Aircraft ADR1,713$38,169$50,397Brazil     ***Banking and Financial (11.2%)***    Aegon NV ADR2,19619,73629,273NetherlandsAXA ADS3,00059,78457,780FranceBanco Bilbao Vizcaya ADS1,8007,70221,636SpainING Groep ADS1,44836,13431,219NetherlandsToronto-Dominion Bank1,40018,15944,086Canada *SUB-TOTAL*141,515183,994 ***Building Materials (4.6%)***    CRH plc ADR2,00023,07537,300IrelandHanson plc ADR1,10033,05538,566UK *SUB-TOTAL*56,13075,866 ***Computers (15.1%)***    Business Objects SA ADS*6,00019,570204,600FranceDassault Systems ADR1,00028,38044,950France *SUB-TOTAL*47,950249,550 ***Consumer Products (2.9%)***    Coca-Cola Femsa ADS1,5009,75030,675MexicoGucci Group NV20010,92516,992Italy *SUB-TOTAL*20,67547,667 ***Electronics (5.6%)***    Epcos AG ADS2,50057,30757,475GermanySony ADR1,00047,51734,350Japan *SUB-TOTAL*104,82491,825 ***Hotels (1.8%)***    Fairmont Hotels & Resorts1,10024,38530,305Canada     ***Medical-Drugs (2.9%)***    Aventis ADS50815,85929,286FranceGlaxo Smithkline plc ADR4009,80018,352UK *SUB-TOTAL*25,65947,638 ***Metals & Mining (5.4%)***    Potash Corp. of Saskatchewan50034,23440,570CanadaRio Tinto plc ADS50031,17549,125UK *SUB-TOTAL*65,40989,695 ***Oil & Gas Production (6.8%)***    EnCana1,00035,02036,730CanadaRepsol-YPF ADR2,00043,59234,980SpainTotal Fina Elf ADR50021,86440,385France *SUB-TOTAL*100,476112,095 **20** **November        30, 2003 Annual Report********(Graphic      Omitted)**SEXTANT      INTERNATIONAL FUND** 
**INVESTMENTS*****Issue******Number of Shares******Cost******Market Value******Country***     ***Paper Products (3.8%)***    Metso ADS*2,100$22,802$24,675FinlandUPM-Kymmene Oyj ADS2,00034,39937,440Finland *SUB-TOTAL*57,20162,115 ***Photographic Equipment (3.5%)***    Canon ADR1,00023,42646,650JapanFuji Photo Film ADR40010,05011,436Japan *SUB-TOTAL*33,47658,086 **Real Estate (2.8%)**    Intrawest 2,40041,34245,264Canada     ***Telecommunications (8.7%)***    America Movil ADR2,00029,72551,280MexicoBCE1,60030,12035,792CanadaBritish Sky Broadcasting ADS*45011.06221,096UKPT Indosat ADR1,00020,95213,260IndonesiaTelefonica ADS58612,05822,748Spain *SUB-TOTAL*103,917144,716 ***Transportation (8.9%)***    Canadian Pacific Railway Ltd.1,20020,33832,688CanadaDesc SA ADR2,70042,98115,120MexicoLan Chile ADS3,50024,63653,725ChileNissan Motor ADR2,00030,08545,560Japan *SUB-TOTAL*118,040147,093 ***Utilities-Electric (4.5%)***    Enel ADS80035,37225,640ItalyEnersis ADS4,00037,12525,760ChileKorea Electric Power ADS2,00031,96122,760Korea *SUB-TOTAL*104,45874,160 ***Utilities-Gas (.3%)***    Transport de Gas del Sur ADR1,50018,8075,550Argentina     ***Total Investments (91.9%)*** **$1,102,433****$1,515,476** Other Assets (net of liabilities) (8.1%)  134,155 ***Total Net Assets (100%)***  **$1,649,631**      ** Non-income producing*    

 
**November      30, 2003 Annual Report**** *21***FINANCIAL HIGHLIGHTS** **SEXTANTINTERNATIONAL          FUND**(graphic          omitted)Selected data per share of capital stockoutstanding            throughout each year       **For Year Ended November 30,**  **2003****2002****2001****2000****1999****Net asset value at beginning of year** **$6.07****$7.24****$8.52****$8.32****$6.81**Income from investment operations      Net investment income  0.01 0.02 0.04 0.43 0.13 Net gains or losses on securities (both realized and            unrealized)  2.00 (1.16) (1.30) 0.20 1.57 Total from investment operations  2.01 (1.14) (1.26) 0.63 1.70 *Less distributions*      Dividends (from net investment income)  (0.03) (0.03) (0.02) (0.43) (0.12)Distributions (from capital gains)  -  -  -  - (0.07)Total distributions  (0.03) (0.03) (0.02) (0.43) (0.19)**Net asset value at end of year********$8.05****$6.07****$7.24****$8.52****$8.32****Total return********33.23%****(15.80)%****(14.80)%****7.62%****24.90%**Ratios/supplemental data      Net assets ($000), end of year $1,650$1,150$1,445$1,736 $1,162 Ratio of expenses to average net assets* 1.10%1.17%1.17%1.20%0.72%Ratio of net investment income to average netassets 0.75%0.20%0.34%4.74%1.74%**Portfolio turnover rate********4%****4%****6%****11%****17%***For each of the above years, all or a portion of              the operating expenses were waived. If these costs had not been              waived, the resulting increases to the ratio of expenses toaverage              monthly net assets would be .19%, .19%, .20%, .16%, and .26%,respectively.            
**STATEMENT OF              ASSETS AND LIABILITIES******    *As of November 30, 2003*       **Assets**   Investments (cost $1,102,433) $1,515,476Cash 137,802Dividends receivable 1,330****Total Assets$1,654,608**** **Liabilities** Payable to adviser 600Other Liabilities 4,377****Total Liabilities4,977**** **Net Assets** **$1,649,631****** ******Fund shares outstanding** 204,953**** **Analysis of Net Assets** Paid in Capital (unlimited shares authorized, without            par value) 1,410,430Accumulated net investment income 1,962Accumulated net realized loss  (175,804)Unrealized net appreciation on investments  413,043****Net Assets applicable to Fund sharesoutstanding$1,649,631**** **Net Asset Value, Offering and Redemption price per            share** **$8.05**
*(The accompanying notes are anintegral        part of these financial statements)*
**22** **November              30, 2003 Annual Report************(graphic            omitted)******SEXTANT            INTERNATIONAL FUND** 
**STATEMENT              OF OPERATIONS****** *For the year ended November 30, 2003*    **Investment income**   Dividend income (net foreign taxes of $4,085) $23,177Miscellaneous income 284 ****Gross investment income$23,461**** **Expenses** Investment adviser and administration fee 7,914Filing and registration fees 3,075Custodian fees 2,460Professional fees 1,725Other expenses 909Printing and postage 330Total gross expenses 16,413Less custodian fees waived (2,460)Net expenses 13,953****Net investment income9,508**** **Net realized loss on investments** Proceeds from sales 47,387Less cost of securities sold (based on identifiedcost) 78,057****Realized net loss(30,670)**** **Unrealized gain on investments** End of year 413,043Beginning of year (5,947)Increase in unrealized gain for theyear 418,990 Net realized and unrealized gain388,320  **Net increase in net assets resulting from operations************$397,828**    ********STATEMENT OF CHANGES IN NET            ASSETS** 
******** **Year ended****Year ended** **Nov. 30, 2003****Nov. 30, 2002****INCREASE (DECREASE) IN NET ASSETS*****From Operations***Net investment income $9,508$2,569Net realized loss on investments(30,670)(70,706) Net increase (decrease) in unealized appreciation418,990(141,217)Net increase (decrease) in net assets 397,828(209,354)*******Dividends to shareowners from*****Net investment income**(7,547)(4,909)*******From fund share transactions***Proceeds from sales of shares222,52858,704Value of shares issued in reinvestment ofdividends7,5294,897 230,05763,601Cost of shares redeemed(121,076)(143,789)Net increase (decrease) in net assets from sharetransactions108,981(80,188)**Total increase (decrease) in net assets****$499,262****$(294,451)********NET ASSETS**Beginning of year1,150,3691,444,820End of year$1,649,631$1,150,369******Undistributed net investment income**1,962-   **Shares of the fund sold and redeemed**Number of shares sold32,2869,019Number of shares issued in reinvestment ofdividends935807 33,2319,826Number of shares redeemed(17,938)(19,618)**Net increase (decrease) in number of sharesoutstanding****15,283****(9,792)**
*(The accompanying notes are an integral part ofthese          financial statements)*
***November              30, 2003 Annual Report***** **23****DISCUSSION              OF SEXTANT INTERNATIONAL FUND PERFORMANCE**
                (unaudited) 
**FISCAL YEAR2003**          For the fiscal year ended November 30, 2003, the Sextant International          Fund gained 33.23%. The comparable Amex International Index gained21.16%.          At the end of this latest fiscal year, the Fund ranked in the 3rdpercentile          of the 210 funds in Morningstar’s peer Foreign Large Growthcategory*.          For the last five years, the Fund has provided an +5.02% annualized          total return. At November 30, 2003, the Fund held Morningstar’s          top “5-star” rating (judged against 163 Foreign Large Growth          funds)*.           The volatility, risks and returns of the stock market continue. The          poor performance of international markets in 2000, 2001 and 2002 were          reversed in 2003 and stocks provided investors with strong investment          returns. Remember, a long-term approach is the best opportunity toprosper.

**FACTORSAFFECTING          PAST PERFORMANCE**          The US economy in 2003 got better and better, buoyed by consumerspending,          tax cuts, and a weakening dollar. It was a “perfect storm”          where every factor, even unpopular foreign wars, worked to thecountry’s          economic benefit. Foreign companies, especially the larger companies          favored by the Fund, also did well. But, without doubt, the massive          decline in the US dollar was the primary factor that benefited theFund          in 2003. The Fund performed exceeding well for investors seeking to          hedge their portfolios against the US dollar.          Investing in foreign securities includes risks not present in domestic          securities. Unlike most years, foreign stocks were generally lessvolatile          than domestic issues. Our portfolio was more heavily invested inEurope          and Canada than Asia, which hurt results slightly. Commodity prices          turned upward, bringing substantial appreciation to our cyclical and          resource-based issues. Financials did well as global interest rates          remained low.

**LOOKINGFORWARD**          The Sextant International Fund is broadly diversified in growingcompanies          headquartered outside the United States. Our focus on value investing          continued to serve us in 2003, when markets rallied around the world          and the US dollar collapsed.           Stocks ultimately reflect their underlying business values. Aftertheir          weak performances for three years, we feel many stocks are quiteattractively          priced. Growth of the U.S. economy is expected at 4% to 6% in 2003,          as low interest rates boost consumer confidence, spending andinvestment.          Foreign economies normally recover as the US market buys more foreign          goods and services. We expect that our portfolio of securities will          continue to show growth and the Fund will further improve itsperformance.

****
*24* *November 30,              2003 Annual Report***
**MANAGEMENT FEE          CALCULATIONS**The Sextant International Fund calculates part of itsmanagement          fee based on a comparison of the Fund’s return to the averagereturn          of the Morningstar fund category “Foreign Stock”. AtNovember          30, 2003, the one-year return for this category average was 24.70%.          Because the Fund's 12-month return outperformed this average by more          than 4% at November 30, 2003, a performance bonus adjustment of 0.30%          was added to the basic 0.60% annual management fee for the month of          December 2003. While still a small fund, market appreciation boosted          the Fund's assets during the year. This helped the total expense ratio          decrease slightly to 1.10% from 1.17%.

**COMPARISON TO          INDEX**          Comparison of any fund to an index must be made bearing in mind that          the Index is unmanaged, and expense-free. The graph below compares$10,000          invested in the Fund at its inception, compared to a similar amount          invested in the AMEX International Index. This capitalization-weighted          index averages 50 American Depository Receipts (ADRs) of largeworldwide          companies, and reflects the types of securities in which SextantInternational          Fund invests. The graph shows that a $10,000 investment made onSeptember          1995 would have risen to $17,821 in the Fund and $12,069 in the Index.          The returns shown do not reflect the deduction of income taxes that          an investor could pay on income received or the sale of profitableinvestments.          

 

**Sextant International Fund vs. AMEX International Index(unaudited)**

*(graph omitted)*

 
*November 30, 2003              Annual Report*** *25****NOTES                TO FINANCIAL STATEMENTS***
**Note 1 -*Organization***                Saturna Investment 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 seriesinvestment                company under the Investment Company Act of 1940, as amended.                Five portfolio series have been created to date: SextantShort-Term                Bond Fund, Sextant Bond Income Fund, Sextant Growth Fund, and                Sextant International Fund (the "Funds"), and Idaho                Tax-Exempt Fund, distributed through a separate prospectus and                the results of which are contained in a separate report.              

**Note 2 -*Significant                Accounting Policies*****The following is a summary of the significantaccounting                policies followed by the Funds.              

***Investments:***Securities traded on a national exchange or the national                over-the-counter market system are valued at the last sale price                or, in the absence of any sale on that date, the closing bidprice.                Other securities traded in the over-the-counter market arevalued                at the last bid price. 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 andadjusted                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 arerecorded                on trade date. Realized gains and losses are recorded on theidentified                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. Marketdiscounts                are recorded as realized gains upon disposition. Cash dividends                from equity securities are recorded as income on the ex-dividend                date. 

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

***Income taxes:***The Funds have elected to be taxed as regulatedinvestment                companies under the Internal Revenue Code and distributesubstantially                all of their taxable net income and realized net gains oninvestments.                Thus, no provision for Federal income taxes is required.              
***Reclassification of capital accounts:***Accounting principles generally accepted in the United                States of America require that certain components of net assets                relating to permanent differences be reclassified betweenfinancial                and tax reporting. These reclassifications have no effect on net                assets or net asset value per share. For the year ended November                30, 2003 the Bond Income Fund            
increased accumulated net realized loss by $15,107                and decreased paid in capital by $15,107. The Growth Fundincreased                accumulated net investment loss by $15,357 and decreased paid                in capital by $15,357.              

***Dividends and distributions toshareowners:***Dividends and distributions to shareowners are recorded                on the ex-dividend date. For the Sextant Short-Term Bond Fund                and Sextant Bond Income Fund, dividends are paid daily anddistributed                on the last business day of each month. For the Sextant Growth                Fund and Sextant International Fund, dividends are payable at                the end of each November. Shareowners electing to reinvestdividends                and distributions purchase additional shares at the net asset                value on the payable date.              
***Use of Estimates:***The preparation of financial statements in conformity                with accounting principles generally accepted in the UnitedStates                of America requires management to make estimates and assumptions                that affect the reported amounts of assets and liabilities at                the date of the financial statements. Actual results coulddiffer                from those estimates.              
**Note 3 -*Transactions                with Affiliated Persons*****Under a contract approved by shareowners on September                28, 1995, Saturna Capital Corporation provides investmentadvisory                services and certain other administrative and distributionservices                to conduct Trust business. Each of the Funds pays the Adviser                a base Investment Advisory and Administrative Services Fee of                .60% of average net assets per annum, payable monthly. The base                Advisory Fee is subject to adjustment up or down depending on                the investment performance of the Fund relative to a specified                index. The Adviser has voluntarily undertaken to limit expenses                of Sextant Short-Term Bond Fund to 0.60% through March 31, 2004                (and Sextant Bond Income Fund to April 1, 2003) and waives its                investment advisory and administrative fee as to SextantShort-Term                Bond Fund and Sextant Bond Income Fund completely so long asassets                of either Fund are less than $2 million.
                For the year ended November 30, 2003, Sextant Bond Income Fund                and Sextant Growth Fund incurred advisory expenses of $15,620                and $31,950, respectively. Sextant International Fund incurred                advisory expenses of $7,914 and Sextant Short-Term Bond Fundincurred                advisory expenses of $15,979.              
In accordance with the expense waiver noted above,                for the year ended November 30, 2003, Saturna Capital waived$11,092                of the Sextant Short-Term Bond Fund advisory fee and $3,530 of                that of Sextant Bond Income Fund.              
In accordance with the Funds' custodian agreements                with National City Bank, for the year ended November 30, 2003,                custodian fees for Bond Income, Short-Term Bond, Growth, andInternational,                were $641, $1,971, $2,285, and $2,482, respectively. Thecustodian                waived its fees for earnings credits.              
               
             *26* *November 30,                2003 Annual Report***
         
               
One trustee, who also serves as the president of                the Trust, is a director and president of the Adviser. The four                unaffiliated trustees receive $100 per Board or committeemeeting                attended. On November 30, 2003, the turstees, officers and their                immediate families as a group owned 18.7%, 25.6%, 17.2% and34.2%                of the outstanding shares of Bond Income, Short-Term Bond,Growth                and International, respectively.              
The Trust acts as a distributor of its own shares,                except in those states in which Saturna Brokerage Services, Inc.                (a subsidiary of Saturna Capital Corporation) is itselfregistered                as a broker-dealer and acts as distributor without compensation.              
Saturna Brokerage Services is the primarystockbroker                used to effect portfolio transactions for Sextant Growth Fund                and Sextant International Fund, and was paid $2,002 and $1,287,                respectively in commissions at discount rates during the year                ended November 30, 2003.              
**Note 4 -*Federal Income                Taxes*****At November 30, 2003, Bond Income had capital loss                carryforwards of $33,841, of which $11,717 expires in 2005,$5,730                expires in 2007, $2,141 expires in 2009 and $14,253 expires in                2010; Short-Term Bond had capital loss carryforwards of $29,523                of which $766 expires in 2005, $4,467 expires in 2007, $9,191                expires in 2008, and $15,099 expires in 2009; Growth Fund had                capital loss carryforwards of $31,379 of which $20,701 expires                in 2009 and $10,677 expires in 2010; and International hadcapital                loss carryforwards of $175,804, of which $1,570 expires in 2008,                $72,857 expires in 2009, $70,706 expires in 2010, and $30,671                expirs in 2011, subject to regulation. Prior to theirexpiration,                such loss carryforwards may be used to offset future net capital                gains realized for federal income tax purposes.              
For the year ended November 30, 2003, theundistributed                net investment income on a tax basis for Short-Term Fund, Bond                Income Fund, Growth Fund, and International Fund was $0, $0, $0,                and $1,962, respectively.

**Note 5 -*Investments*****At November 30, 2003, the net unrealized gain oninvestments                for Bond Income, Short-Term Bond, Growth and International were                $169,117, $62,732, $1,615,709, and $413,043, which consists of                unrealized gains of $169,192, $66,432, $1,737,694, and $568,345,                and unrealized losses of $75, $3,700, $121,985, and $155,302,                respectively.              
During the year ended November 30, 2003, BondIncome                purchased $155,197 of securities and sold $0 of securities.Comparable                figures for Short-Term Bond are $503,224 purchased $464,965sold;                for Growth $582,482 and $422,958; and for International,$240,363                and $47,387.              
             
**Note 6 -*Distribution                  to shareholders*****The tax character of distributions paid during the                  year ended November 30, 2003 and 2002 were as follows:

Bond Income Fund                  Ordinary income: $97,200 and $107,024, respectively                  Short-Term Bond Fund                  Ordinary income: $101,962 and $118,239, respectively

International Fund                  Ordinary income: $7,529 and $4,909, respectively

 

 

 

 

(grahic omitted)

 

 

**PRIVACY STATEMENT**

*At Saturna Capital, we understand theimportance                  of maintaining the privacy of your financial information. To                  that end, we want to insure that we protect theconfidentiality                  of any personal information you share with us.                  We collect personal information about you from information we                  receive from you on applications and other forms and fromtransactions                  or trades placed with us. Please be assured that except toadminister                  a transaction with an affiliated third party upon yourrequest,                  we do not disclose any personal information about ourcustomers,                  or our former customers, to anyone, except as may be required                  by law. We maintain our own technology resources to minimize                  the use of outside service providers.                  Additionally, Saturna Capital restricts access to personalinformation                  about you to those employees who need to know that information                  to provide products or services to you. We maintain physical,                  electronic, and procedural safeguards that comply with federal                  standards to guard your personal information. If you havefurther                  questions or concerns about the security or privacy of theinformation                  we receive from you, please call us at 1-888/732-6262.*

 

 

 
*November 30, 2003              Annual Report*** *27*
         
**Web: http://www.saturna.com                  E-mail: sextant@saturna.com**

 

 

(logo)

SaturnaCapitalMutual Funds                  1300 N. State Street                  Bellingham WA 98225-4370 

1-800/SATURNA(800/728-8762)*1-888/732-6262 for automated assistance,                    including fund prices*

***Source: Morningstar11/30/03**.                  Past performance does not guarantee future results. For each                  fund with at least a three-year history, Morningstarcalculates                  a Morningstar Rating™ based on a MorningstarRisk-Adjusted                  Return measure that accounts for variation in a fund’s                  monthly performance (including the effects of sales charges,                  loads, and redemption fees), placing more emphasis on downward                  variations and rewarding consistent performance. The top 10%                  in each category receive 5 stars, the next 22.5% 4 stars, the                  next 35% 3 stars, the next 22.5% 2 stars and the bottom 10%                  receive 1 star. (Each share class is counted as a fraction of                  one fund within this scale and rated separately, which maycause                  slight variations in the distribution percentages.) TheOverall                  Morningstar Rating for a fund is derived from a weightedaverage                  of performance figures associated with its 3-, 5- and 10-year                  (if applicable) Morningstar Rating metrics. SextantInternational                  was ranked 13th against 163 Foreign Large Growth funds in the                  last 3 years and 7th against 128 funds in the last 5 years.                  With respect to these Foreign Large Growth funds, SextantInternational                  received a Morningstar Rating of 4 and 5 stars for the 3- and                  5- year periods, ended 11/30/03 respectively. Sextant Growth                  was ranked 20th against 606 Mid-Cap Growth funds in the last                  3 years, 17th against 385 funds in the last 5 years, and 38th                  against 124 funds in the last 10 years. With respect to these                  Mid-Cap Growth funds, Sextant Growth received a Morningstar                  Rating of 4, 4, and 4 stars for the 3-,5-, and 10- yearperiods,                  ended 11/30/03 respectively. Sextant Short-Term Bond wasranked                  18th against 197 Short-Term Bond funds over the last 3 years                  and 24th against 162 funds in the last 5 years. With respect                  to these Short-Term Bond funds, Sextant Short-Term received                  a Morningstar Rating of 4 and 4 stars for the 3- and 5- year                  periods, ended 11/30/03 respectively. Sextant Bond Income was                  ranked 25th against 58 Long-Term Bond funds in the last 3years,                  33rd against 47 funds in the last 5 years, and 73rd against                  20 funds in the last 10 years. With respect to these Long-Term                  Bond funds, Sextant Bond Income received a Morningstar Rating                  of 4, 4 and 2 stars for the 3, 5 and 10 year periods, ended                  11/30/03 respectively.

Thisreport                  is issued for the information of the shareoweners of the Fund.                  It is not authorized for distribution to prospective investors                  unless it is accompanied or preceded by an effectiveprospectus                  relating to the securities of the Fund. Idaho Tax-Exempt Fund                  is a series of Saturna Investment Trust.

  

(graphic omitted)
 SEXTANTMutual Funds 
 

 

**SHORT-TERM                          BOND**

**BONDINCOME**

**GROWTH**

**INTERNATIONAL******

 

 

**ANNUAL                          REPORT****November 30, 2003**

*28* *November                  30, 2003 Annual Report***
 

**REPORT TOSTOCKHOLDERS**

  

**Idaho Tax-ExemptFund**
**November 30, 2003Report**
Fellow Shareowners:          
For the fiscal year ending November 30, 2003, Idaho            Tax Exempt Fund provided a total return of +5.40%. The net assetvalue            was $5.46 per share compared to $5.38 one year ago and $5.57 in our            May semi-annual report. Over the past twelve months, the FederalReserve            Bank‘s policy has remained preoccupied with guarding against            persistent deflationary forces. The potential damage caused by acycle            of falling prices convinced the central bank to lower the Federal            Funds rate to a new generational low of 1.00%.             Fortunately, we now have a strong economic recovery. Largeproductivity            increases have reduced the inflationary threat usually posed byrapid            economic growth. This means the potential non-inflationary growth            rate for the US economy has risen significantly. The Federal Reserve            Bank now believes that the US economy can grow significantly faster            than in the past without triggering a new inflationary cycle.            The rapid economic recovery has unnerved many fixed income investors            who associate cyclical turning points in the economy with cyclical            increases in interest rates. Today however the forces restraining            inflation remain potent and as such the cyclical increase ininterest            rates (over the next twelve months) caused by the current economic            recovery may be significantly less than in past cycles. In fact,despite            the surge in rates since June, rates on US Treasuries are virtually            unchanged from a year ago and municipal rates are still slightlylower            than one year ago.             Looking ahead, the revival in capital spending will continue andrising            employment will follow. Strong commodity prices, a rising budgetdeficit            and a weak dollar will keep the US yield curve steep. In 2004, rates            will continue to slowly rise from the lows set last June. Management            intends to limit the weighted average maturity of the fund to reduce            downside price risk for shareowners. Conservative investors choose            the Idaho Fund for tax-free income and low price volatility whenthey            reallocate assets from common stock portfolios to the relativesafety            of municipal bonds. We remain convinced that well-balanced,diversified            investor portfolios including Idaho Tax Exempt Fund shares willproduce            another year of positive results in 2004.            Idaho’s farmers and hydroelectric power generators arebenefiting            from good rains this winter. Idaho continues to have some of thebest            demographics of any state. Global demand for Idaho’s hightechnology            products is growing again, and tourism is recovering. Construction            remains firm. The state’s tightly controlled budget andpro-business            policies still give the Idaho a sharp edge.            We invite you to review the advantages of the Idaho Tax-Exempt Fund,            including low expenses, income free from Idaho and federal income            taxes, a high-quality diversified bond portfolio and dailysupervision            by professional managers. We welcome your suggestions. Only withyour            help can we be certain that we are meeting your investment needs—            our primary objective.

***NicholasKaiser,******Phelps                  McIlvaine,***President 
Vice President, PortfolioManager                  
January 3, 2004          
           *November 30,                2003 Annual Report*** *29***INVESTMENTS**  ***Rating*******Issuer******Coupon/Maturity******Face Amount******Market Value***   *As of November 30, 2003****Airport Parking (2.9%)***    AAABoise City Airport Revenue COP5.40% due 8/1/2011$215,000 $221,788***Electric Power (2.1%)***    AAAIdaho Falls Electric Revenue 6.75% due 4/12/2019155,000 165,855***Financial Services (2.3%)***    AAABoise City General Fund Revenue5.20% due 12/1/2017160,000173,645***General Obligations (50.4%)***    AA-Ada & Canyon Counties JSD #25.50% due 7/30/2011175,000 199,668 "5.50% due 7/30/2015100,000 115,060AAAAdams County5.00% due 8/1/2014110,000 116,628A+Bannock County Jail5.05% due 9/1/201295,000 101,023AAABannock County SD #25 Pocatello5.20% due 8/1/2014100,000108,387A"5.25% due 8/1/2016110,000 118,359A"4.90% due 8/1/200990,00097,379AAABingham County SCD #55 Blackfoot4.65% due 8/1/2017285,000298,763AA-Boise City ISD UTGO 19965.50% due 7/30/2016150,000161,196AABoise City ISD Rev. Ada & Boise5.00 due 8/15/2014100,000109,983ABoise County SD #73 Horshoe Bend5.15% due 7/31/2010125,000 134,296AAABoundary County SCD #1014.05% due 8/1/2015200,000201,232AAACaldwell, Idaho 5.30% due 5/15/2014150,000 166,918AAACanyon County SCD #139 Valley View4.05% due 8/15/201680,00078,546AAACanyon County SD #1325.40% due 7/30/2011195,000 201,721 "5.40% due 7/30/2012100,000 103,447AAACanyon County SD #134 Middleton4.65% due 7/31/2016170,000181,524ACanyon County SD #135 Notus    Series 19946.00% due 8/1/200750,000 49,912AAACassia & Twin Falls JSD #1515.375% due 8/1/201385,000 91,884 "5.375% due 8/1/201575,000 81,014AAAClark County SD #161 Dubois5.00 % due 8/1/2015270,000291,345AAIdaho Housing and Finance Association4.80% due 6/1/2017100,000105,680AAAKootenai County SD #2735.00% due 7/30/201670,000 73,181AAAKuna Sch/Comm Library District4.90% due 8/1/201375,000 80,967AAALatah County SCD #2874.10% due 8/1/2021150,000143,678AAALemhi County4.20% due 8/1/2015100,000101,956AAAMeridian Free Library District5.00% due 8/1/2015200,000212,742AAAPower & Cassia Cos. JSD #3815.25% due 8/1/201260,000 66,929AAATeton County SD #401 5.50% due 8/1/201275,000 80,753 SUB-TOTAL 3,645,0003,874,171***Housing (3.7%)***        AAIdaho Housing Authority    Single Fam Mortgage, B-16.85% due 7/1/201240,00040,363AAIdaho Housing Authority    Refunding Series A6.15% due 7/1/202480,00081,494AA+Idaho Housing Authority    Single Fam Mort Mezz-E-16.60% due 7/1/201125,00025,415AAIdaho Housing Authority    Single Fam Mort Rev Ser B18.00% due 1/1/20205,0005,174AAAValley County Jail Project Ref.4.70% due 8/1/2014125,000130,580 SUB-TOTAL 275,000283,026*30******November                  30, 2003 Annual Report********Rating*******Issuer******Coupon/Maturity******Face Amount******Market Value******Medical/Hospitals (4%)***    AAAIdaho Health Facility Auth. Ref.    Holy Cross 5.25% due 12/1/2011$65,000$70,829AAAIdaho Health Facility Auth. Ref.    Holy Cross Sys Corp Rev5.00% due 12/1/2014110,000118,457AAAIdaho Health Facility Auth. Corp.    Holy Cross Rev Refunding5.25% due 12/1/2022115,000117,399 SUB-TOTAL 290,000306,685***Real Estate (5%)***    AAABoise City Urban Renewal Agency Pk Rev &RA5.00% due 9/1/201265,00071,086AAAIdaho State Bldg Authority 5.00% due 9/1/2021100,000 103,330AJerome Urban Renewal District5.40% due 9/1/2013200,000209,670   365,000 384,086***Roads (1.4%)***    APayette L.I.D. #89-17.60% due 5/1/200530,000 30,306APost Falls L.I.D. #91-17.95% due 4/15/200420,000 19,978APost FallsL.I.D. #91-47.95% due 4/15/200520,000 19,970 "7.95% due 4/15/200620,000 19,970 "7.95% due 4/15/200720,000 19,997 SUB-TOTAL 110,000 110,221***State Education (12.1%)***    AAABoise State University Revs-Ref.5.10% due 4/1/2014300,000 326,528AAAIdaho State Building Authority4.00% due 9/1/2016105,000105,309AAAIdaho State University Ref & I mpt4.90% due 4/1/2017150,000159,162AAAUniversity of Idaho5.60% due 4/1/2015185,000204,332AAAUniversity of Idaho    Student Fee Revenue5.25% due 4/1/2014120,000133,375 SUB-TOTAL 860,000 928,706***Sewer (1.4%)***    ATroy, Sewer Revenue7.60% due 2/1/200410,000 9,962 "7.70% due 2/1/200515,000 14,942 "7.80% due 2/1/200615,000 14,954 "7.90% due 2/1/200715,000 14,962 "8.00% due 2/1/200815,000 14,966 "8.00% due 2/1/200920,000 19,957 "8.00% due 2/1/201020,000 19,964 SUB-TOTAL 110,000 109,707***Urban Renewal (4.8%)***    AAABoise City Urban Ren Agcy Lease Rev5.875% due 8/15/2025190,000 208,068AAPocatello Dev Auth Rev Al Tax Inc5.15% due 3/1/2011150,000 160,364 SUB-TOTAL 340,000 368,432***Water Supply (7%)***    AAAKetchum Water Revenue4.75% due 9/1/201360,00063,700AAAMcCall Water Rev., Series 19946.25% due 9/1/2008200,000 221,860*November                  30, 2003 Annual Report***** *31****Rating*******Issuer******Coupon/Maturity******Face Amount******Market Value***AAAMcCall Water Revenue6.375% due 9/1/2014$70,000 $76,113AAAMoscow Sewer Revenue4.125% due 11/1/2008165,000177,752 SUB-TOTAL 495,000539,425     **Total Investments (97.1%)** (Cost = $7,095,386)$7,020,000$7,465,747Other Assets (net of liabilities) (2.9%)   225,970**Total Net Assets (100%)**   $7,691,717** These unaudited bond ratings reflect theadviser's                current rating of each bond, as determined using Standard &Poor's                and Moody's ratings.* *Trustees and Officers(unaudited)* 
**Name and (age)                  Address**
**Position(s) held with                Trust and Length of                 Time Served****Principal Occupation(s)                 during past 5 Years****Number of Portfolios in                Fund Complex                overseen by Trustee****Other Directorships                Held by Trustee****INDEPENDENT TRUSTEES**A. Herbet Ershig (65)                22 Shorewood Drive                Bellingham, WA 98225Independent Trustee                  since 1997President (now retired), Ershigs, Inc.                  (industrial fabrication)FiveNoneGary A. Goldfogel (4454)                1500 N. State Street                Bellingham, WA 98226Independent Trustee                  since 1995Medical Examiner (pathologist)                  Owner, Avocet Environmental Testing (laboratory)FiveNoneJohn E. Love (71)                1002 Spokane Street                Garfield, WA 99130Independent Trustee                  since 1987Owner, J.E. Love Co., (agricultural equipmentmanufacturer)FiveNoneJohn S. Moore (72)                346 Bayside Road                Bellingham, WA 98225Independent Trustee                  since 1993Professor (now retired), College of Business and                Economics, Western Washington UniversityFiveNone**INTERESTED TRUSTEES**Nicholas F. Kaiser, CFA (57)                1300 N. State Street                Bellingham, WA 98225President and Trustee                  since 1989President, Saturna Capital Corporation                  President, Saturna Brokerage ServicesSevenAmana Mutual Funds Trust**OFFICERS WHO ARE NOTTRUSTEES**Phelps S. McIlvaine (50)                1300 N. State Streeet                Bellingham, WA 98225Vice President                  since 1994Vice President, Saturna CapitalCorporation                  Treasurer, Saturna Brokerage ServicesN/AN/AChrisopher R. Fankhauser (31)                1300 N. State Street                Bellingham, WA 98225Treasurer                  since 2002Manager of Operations, Saturna CapitalCorporationN/AN/AEthel B. Bartolome(31)                1300 N. State Street                Bellingham, WA 98225Secretary                  since 2001Corporate Administrator, Saturna CapitalCorporation                [since 2000]                 Administrator, Cytel Corporation [1994-1999]N/AN/ATerm of Office: Each Trustee serves                for the lifetime of the Trust or until he dies, resigns, isremoved,                or not re-elected by the shareowners. Each officer serves aone-year                term subject to annual reappointment by the Trustees.                Mr. Kaiser is an interested person of the Trust by reason of his                positions with the Trust's adviser and underwriter. Mr.McIlvaine                is the primary manager of the Fund's portfolio. Saturna Capital                Corporation is the Fund's advisor, and Saturna BrokerageServices,                Inc. is the distributor.*32******November                  30, 2003 Annual Report*******FINANCIAL                  HIGHLIGHTS***Selected data per share of capital stockoutstanding                throughout the year:* **For Year Ended November 30,**  **2003****2002****2001****2000****1999****Net asset value at beginning of year** **$5.37****$5.28****$5.13****$5.01****$5.36***Income from investment operations*      Net investment income 0.210.220.220.23 0.24 Net gains or losses on securities (both realized                and unrealized) 0.090.090.150.12 (0.35)Total from investment operations 0.300.310.370.35 (0.11)*Less distributions*      Dividends (from net investment income) (0.21)(0.22)(0.22)(0.23)(0.24)Distributions (from capital gains) -----Total distributions (0.21)(0.22)(0.22)(0.23)(0.24)       **Net asset value at end of year** **$5.46****$5.37****$5.28****$5.13****$5.01**  **********************Total Return** **5.40%****5.98%****7.40%****7.28%****(2.18)%**       Ratios / Supplemental Data      Net assets ($000), end of year $7,692$6,943$6,650$5,628 $6,151 Ratio of gross expenses to average netassets* 0.85%0.80%0.79%0.80%0.80%Ratio of net investment income to average netassets 3.78%4.14%4.21%4.69%4.55%**Portfolio turnover rate********6%****11%****13%****14%****13%**       *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 the ratio of expenses to average net                assets would be .03%, .08%, .11%, .14%, and .05%,respectively.**STATEMENT                    OF ASSETS AND LIABILITIES***As of November 30, 2003*   **Assets**Bond investments (cost $7,095,386)$7,465,747Cash128,320Interest receivable107,865Insurance Reserve Premium2,473 Total Assets$7,704,405   **Liabilities**Payable to adviser3,200Shareholder servicing fees350Other Liabilities9,138Total Liabilities12,688 **Net Assets**$7,691,717 **Fund Shares Outstanding**1,409,855 **Analysis of Net Assets**Paid in Capital (unlimited shares authorized,without                par value)7,342,356Accumulated net realized loss (20,999)Unrealized net appreciation to on investments370,360Net Assets applicable to Fund sharesoutstanding$7,691,717**Net Asset Value, Offering and Redemption price                per share**$5.46
*(The accompanying notes are an integral part of            these financial statements)*
*November                30, 2003 Annual Report***** *33***STATEMENT                  OF OPERATIONS**  *For the year ended November 30,2003***Investment income**   Interest income $350,362Amortization of bond premium (13,316)Accretion 1,062 Gross investment income$338,108  **Expenses** Investment adviser and administration fee 36,578Professional fees 11,718Shareholder service fee 4,250Insurance 3,741Other expenses 2,834Printing and postage 2,322Custodian fees 1,623Filing and registration fees 904Total gross expenses 63,970Less adviser fees waived (329)Less custodian fees waived (1,623)Net expenses 62,018 Net investment income276,090**Net realized gain on investments** Proceeds from sales 539,942Less: cost of securities sold (based on identified                cost) 529,279 Realized net gain10,663**Unrealized gain on investments** End of year 370,360Beginning of year 275,905Increase in unrealized gain for the year 94,455 Net realized and unrealized gain105,118**Net increase in net assets resulting fromoperations** $381,208
*(The accompanying notes are an            integral part of these financial statements)*
*34******November                  30, 2003 Annual Report*******STATEMENT                  OF CHANGES IN NET ASSETS** Year endedYear ended Nov. 30, 2003Nov. 30, 2002**INCREASE IN NET ASSETS**  ***From Operations***  Net investment income$276,090$279,783Net realized gain on investments10,6638,373Net increase in unrealized appreciation 94,455 103,577Net increase in net assets  381,208 391,733 ***Dividends to shareowners from***Net investment income(276,090)(280,029) ***From fund share transactions***Proceeds from sales of shares1,140,412633,759Value of shares issued in reinvestment of dividends216,574222,546 1,356,986856,305Cost of shares redeemed(713,555)(674,999)Net increase in net assets643,431181,306**Total increase in net assets****$748,549****$293,010** **NET ASSETS**Beginning of year6,943,1686,650,158End of year$7,691,717$6,943,168 **Shares of the fund sold and redeemed**Number of shares sold209,181118,569Number of shares issued in reinvestment of dividends39,72641,714 248,907160,283Number of shares redeemed(131,040)(126,945)**Net increase in number of shares outstanding****117,867****33,338**
*(The accompanying notes are an integral part of            these financial statements)*

 

**PrivacyStatement            (unaudited)**
*At Saturna Capital, we understand the importance ofmaintaining                the privacy of your financial information. To that end, we want                to insure that we protect the confidentiality of any personal                information you share with us.                We collect personal information about you from information we                receive from you on applications and other forms and fromtransactions                or trades placed with us. Please be assured that except toadminister                a transaction with an affiliated third party upon your request,                we do not disclose any personal information about our customers,                or our former customers, to anyone, except as may be required                by law. We maintain our own technology resources to minimize the                use of outside service providers.                Additionally, Saturna Capital restricts access to personalinformation                about you to those employees who need to know that information                to provide products or services to you. We maintain physical,                electronic, and procedural safeguards that comply with federal                standards to guard your personal information. If you havefurther                questions or concerns about the security or privacy of theinformation                we receive from you, please call us at 1-888/732-6262.**November                  30, 2003 Annual Report***** *35*
**Discussion of Fund            Performance****(unaudited)**

           **FISCAL YEAR 2003**                  For the year ending November 30, 2003, Idaho Tax Exempt Fund                  returned 5.40%. For the last five years, the Fund has provided                  a 4.76% average annualized return. At November 30, 2003 the                  Fund held Morningstar’s* 4-star rating (judged against                  224 funds in the Muni Single State Intermediate/Short-Termcategory).                  At fiscal year end, the thirty-day SEC current yield was3.20%,                  down from 3.80% one year ago. The Fund’s net assets grew                  10.7% during the year. Consistent with the Fund’sconservative                  investment philosophy, the Fund’s price ranged between                  $5.33 and $5.61 per share (a 5.3% variation from low to high).                  .*Average Annual Total                    Returns*1 year5 years10 years**4.03%****4.79%****5.20%**Performance data for calendar years ended                    12/31/2003. Performance data quoted represents pastperformance                    and investment return and principal value of investment will                    fluctuate so that an investor’s shares, when redeemed                    maybe worth more or less than their original cost.**FACTORS AFFECTING PASTPERFORMANCE**              Stimulative Federal fiscal and monetary policies produced a sharp              growth in the economy and profits in 2003. Inflation and interest              rates remained low, and the equity markets went sharply higher.              Bond prices were stable. Idaho’s economy, based ontechnology,              agriculture and tourism, managed some improvements and the outlook              is good.              Idaho’s high personal income tax rates create a substantial              appetite among residents for tax-exempt bonds, whilemunicipalities              are inherently shy of debt accumulations. The imbalance between              the demand for and the supply of Idaho bonds is an importantelement              in the overall performance of all Idaho tax-exempt bonds in both              bull and bear markets. In 2003, Municipal bonds generallyoutperformed              comparable government issues of rising rates and underperformed              in periods of falling rates.               The average maturity of the Fund is the most important short-term              factor affecting principal values in the portfolio. TheFund’s              maturity is now 5.33 years, down from 5.81 years last November.              This is the short end of its “normal” six to fifteenyear              maturity range. This shorter maturity reduces price risk in arising              rate environment, but sacrifices slightly higher yields available              in longer maturity bonds. As rates did not increase materially in              2003, the Fund erred on the side of caution in choosing theshorter              average maturity.**LOOKING FORWARD**              In 2004, we expect the US economy to grow 4% to 6%, and corporate              profits to increase 15% to 20%. Short-term rates are likely torise              slowly in the second half of the year. We expect high qualityIdaho              10 year municipals yields to increase modestly from 4.00% to just              under 5%. With higher productivity 
           
***Source: Morningstar11/30/03**.            Past performance does not guarantee future results. For each fund            with at least a three-year history, Morningstar calculates aMorningstar            Rating™ based on a Morningstar Risk-Adjusted Return measurethat            accounts for variation in a fund’s monthly performance(including            the effects of sales charges, loads, and redemption fees), placing            more emphasis on downward variations and rewarding consistentperformance.            The top 10% in each category receive 5 stars, the next 22.5% 4stars,            the next 35% 3 stars, the next 22.5% 2 stars and the bottom 10%receive            1 star. (Each share class is counted as a fraction of one fundwithin            this scale and rated separately, which may cause slight variations            in the distribution percentages.) The Overall Morningstar Rating for            a fund is derived from a weighted average of performance figuresassociated            with its 3-, 5- and 10-year (if applicable) Morningstar Ratingmetrics.            Idaho Tax-Exempt was ranked 35th against 224 Muni Single StateInterm/Short-Term            funds over the last 3 years, 34th against 208 funds over the last            5 years, and 27st against 108 funds in the last 10 years. Withrespect            to these numbers of Muni Single-State Iterm/Short-Term funds, Idaho            Tax-Exempt received a Morningstar rating of 4, 4, and 4 stars for            the 3-, 5-, and 10- year periods, ended 11/30/03respectively.
           *36******November                  30, 2003 Annual Report*****
offsetting rising commodity prices, material inflation            is not expected to return. Investors should have the opportunity to            continue to earn positive real returns in high quality Idahomunicipal            bonds for another year. Unfortunately, the availability of newquality            non-rated Idaho bonds continues to wither, while refinancings remove            existing issues from this attractive sector.

**COMPARISON TOINDEX**            The graph compares the Idaho Tax-Exempt Fund‘s performance to            the performance of the Lehman Brothers Composite Municipal BondIndex,            a broad-based municipal bond market index. To be comparable, theMunicipal            Index data includes reinvested income (as computed by LehmanBrothers            Fixed Income Research).            Note that this graph compares an unmanaged, expense free index to            an actively managed Fund that has transaction and other costs. The            Fund also stands ready to buy and sell its own securities toshareholders            on a daily basis, as well as providing a wide range of services to            them. Few investors are able to invest in an exact index portfolio            because of the large amount of securities required to model such an            index.            The graph shows that $10,000 invested in the Idaho Tax Exempt Fund            on 11/30/93 would have grown to $16,817 at the end of November 2003.            If $10,000 could have been invested in the Lehman Brothers Composite            Municipal Bond Index on 11/30/93, it would have grown to $18,179.            These returns do not reflect the deduction of taxes that ashareowner            could pay on fund capital gain distributions or the redemption of            fund shares for a profit.
           
**Idaho Tax Exempt Bond Fund vs. Lehman Composite            Municipal Bond Index (unaudited)**
*(graphic omitted*)          
           *November                  30, 2003 Annual Report***** *37*
           
**NOTES TO FINANCIALSTATEMENTS**
**Note 1 - Organization****Saturna Investment 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 separateprospectus                  and the results of those funds are contained in a separatereport.                

**Note 2 - Significant AccountingPolicies****The following is a summary of the significantaccounting                  policies followed by the Fund.                

**Investments:****Fixed-income securities for which there are nopublicly                  available market quotations are valued using matrices based                  on maturity, quality, yield, call features and similarfactors,                  which are compared periodically to multiple dealer bids and                  adjusted by the adviser under policies established by theTrustees.                                    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 theidentified                  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 or call, as appropriate.                  Interest income is increased by accretion only for bondsunderwritten                  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 otherFunds                  of the Trust on the basis of relative daily average netassets.                  The Adviser has agreed to certain limits on expenses, asdescribed                  below.                

**Income taxes:****The Fund has elected to be taxed as a regulatedinvestment                  company under the Internal Revenue Code and distributesubstantially                  all of its taxable net investment income and realized netgains                  on investments. Therefore, no provision for Federal incometaxes                  is required. Further, the Fund intends to meet IRSrequirements                  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 arerecorded                  on the ex-dividend date. Dividends are paid daily anddistributed                  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.                
**Use of Estimates:**                  The preparation of financial statements in conformity withgenerally                  accepted accounting principles requires management to makeestimates                  and assumptions that affect the reported amounts of assets and                  liabilities at the date of the financial statements. Actual                  results could differ from those estimates.                
                 
               
**Note 3 - Transactions withAffiliated                  Persons****Under a contract approved by shareowners on October                  12, 1990, Saturna Capital Corporation provides investmentadvisory                  services and certain other administrative and distributionservices                  to conduct the Fund’s business. For such services, the                  Fund pays an annual fee equal to .50% of average daily netassets.                  For the year ended November 30, 2003, the Fund incurredadvisory                  fee expenses of $36,578.                  Saturna Capital has volunteered to waive its advisory fee to                  the extent that total expenses of the Fund, (excludinginterest,                  brokerage commissions and taxes) exceeds .80% through March                  31, 2003. Accordingly, for the year ended November 30, 2003,                  Saturna Capital waived $329 of the advisory fee.                   In accordance with the Fund’s agreement with itscustodian,                  National City Bank of Indiana, for the year ended November 30,                  2003, custodian fees incurred by the Fund amounted to $1,623.                  The custodian waived its fees for earnings credits.                  The Trust acts as a distributor of its own shares, except in                  those states in which Saturna Brokerage Services, Inc. (asubsidiary                  of Saturna Capital Corporation) is itself registered as abroker-dealer                  and acts as distributor without compensation. Saturna Capital                  Corporation acts as shareowner servicing agent for the Fund,                  for a monthly fee plus certain expenses. For the year ended                  November 30, 2003, the Fund paid such a fee of $4,250.                   One trustee, who also serves at the president of the Trust,                  is a director and president of the Adviser. The fourunaffiliated                  trustees receive a fee of $100 per meeting attended, allocated                  pro-rata to the five Funds of the Saturna Investment Trust.                  On November 30, 2003, the trustees, officers and theirimmediate                  families as a group owned 0.05% of the outstanding shares of                  the Fund.                
**Note 4 - Federal IncomeTaxes****At November 30, 2003, Idaho Tax-Exempt had capitalloss                  carryforwards of $20,999 which expire in 2008, subject toregulation.                  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, 2003, the net unrealized appreciation                  of investments for the Fund of $370,360 comprised grossunrealized                  gains of $378,202 and gross unrealized losses of $7,842, and                  cost for federal income tax purposes was $7,095,386.                  During the year ended November 30, 2003, the Fund purchased                  $1,166,085 of securities and sold/matured $539,942 ofsecurities.                  **Distributions to shareowners:**                  As of November 30, 2003, the tax composition of dividends are                  as follows:                
11/30/03                  Ordinary Income: $276,090                  Income Per Share: $0.21                  Long-term Capital Gains: $-                  Long-term Capital Gains Per Share: $-                
11/30/02                  Ordinary Income: $280,029                  Income Per Share: $0.22                  Long-term Capital Gains: $-                  Long-term Capital Gains Per Share: $-
               
           

*38******November                  30, 2003 Annual Report*****
           
**REPORT of****INDEPENDENT              CERTIFIED PUBLIC ACCOUNTANTS**

To the Shareowners and Board of Trustees            Idaho Tax-Exempt Fund            We have audited the accompanying statement of assets and liabilities            of the Idaho Tax-Exempt Fund, a series of shares of the SaturnaInvestment            Trust, including the schedules of investments as of November 30,2003,            and the related statements of operations for the year then ended,            the changes in net assets for each of the two years then ended, and            the financial highlights for the five years then ended. Thesefinancial            statements and financial highlights are the responsibility of the            Trust’s management. Our responsibility is to express an opinion            on these financial statements and financial highlights based on our            audits.             We conducted our audits in accordance with auditing standardsgenerally            accepted in the United States of America. Those standards require            that we plan and perform the audit to obtain reasonable assurance            about whether the financial statements and financial highlights are            free of material misstatement. An audit includes examining, on atest            basis, evidence supporting the amounts and disclosures in thefinancial            statements. Our procedures included confirmation of securities owned            as of November 30, 2003, by correspondence with the custodian and            broker. Our audit also includes assessing the accounting principles            used and significant estimates made by management, as well asevaluating            the overall financial statement presentation. We believe that our            audits provide a reasonable basis for our opinion.            In our opinion the financial statements and financial highlightsreferred            to above present fairly, in all material respects, the financialposition            of Idaho Tax-Exempt Fund as of November 30, 2003, the results of its            operations for the year then ended, the changes in net assets for            each of the two years then ended, and the financial highlights for            each of the five years then ended, in conformity with accountingprinciples            generally accepted in the United States of America.          
            Philadelphia, Pennsylvania             January 8, 2004          
/s/ signature            Tait, Weller & Baker          
           
           
*November                  30, 2003 Annual Report***** *39*
           
 

 

 

**Web:http://www.saturna.com                    E-mail: idaho@saturna.com**

 

 

 

 

***(logo)***

 

1300 N. State Street                    Bellingham, WA 98225-47301-800/SATURNA(800/728-8762)***1-888/732-6262                    for automated assistance,                    including fund prices*

*This report is issued for the information of theshareowners                    of the Fund. It is not authorized for distribution toprospective                    investors unless it is accompanied or preceded by aneffective                    prospectus relating to the securities of the Fund. IdahoTax-Exempt                    Fund is a series of Saturna Investment Trust.*

*(graphic omitted)*

 

 

 

 

 

I D A HOTAX-EXEMPT FUND

 

 

 

 

**ANNUAL REPORT***November 30, 2003*
*40******November                    30, 2003 Annual Report*****
**CODE OF ETHICS**

Registrant has adopted a code of ethics and isincluded            with this submission as Exhibit (a).

**AUDIT COMMITTEE FINANCIAL EXPERT**

(a) (1) (i) The Trustees of Saturna Investment Trust            determined, at their quarterly meeting of September 25, 2003, that            the Trust has at least one audit committee financial expert serving            on its audit committee.             (a) (2) (ii) Mr. John Moore, an independent Trustee (as defined for            investment companies), was deemed qualified and agreed to serve.

**PRINCIPAL ACCOUNTANT FEES ANDSERVICES**

*(a) Audit Fees*            For the fiscal years ending November 30, 2003 and 2002, theaggregate            audit fees billed for professional services rendered by theprincipal            accountant were $22,000 and $21,000, respectively.*(b) Audit-Related Fees*            For the fiscal years ending November 30, 2003 and 2002, theaggregate            audit-related fees were $17,000 and $16,000, respectively. Thenature            of the services are: (1) auditing of the statements of assets and            liabilities, related statements of operations and changes in netassets,            and the financial highlights of each of the Funds; (2) auditing and            reporting on the financial statements to be included in theAmendment            to the Funds’ Registration Statement, Form N-1A, to be filed            with the Securities and Exchange Commission; (3) review of theAmendment            to the Registration Statement; and (4) issuance of a Report onInternal            Control Structure for inclusion in Form N-SAR.*(c) Tax Fees*            For the fiscal years ending November 30, 2003 and 2002, theaggregate            tax fees billed for professional services rendered by the principal            accountant were $5,000 for each year. Service includes preparation            of the Funds’ federal and state income tax returns.*(d) All Other Fees*            There were no other fees billed by the principal accountant for the            fiscal years ending November 30, 2003 and 2002.

*(e)(1) Audit Committee Pre-Approval Policies and            Procedures*            The following is an excerpt from the Amana Mutual Funds Trust Audit            Committee Charter:            D. Oversight of Independent Auditors            3. Pre-approval of Audit and Non-Audit Services. Except as provided            below, the Committee’s prior approval is necessary for theengagement            of the independent auditors to provide any audit or non-auditservices            for the Trust and any non-audit services for any entity controlling,            controlled by or under common control with Saturna that providesongoing            services to the Trust (Saturna and each such entity, an“Adviser            Affiliate”) where the engagement relates directly to theoperations            or financial reporting of the Trust. Non-audit services that qualify            under the de minimis exception described in the Securities Exchange            Act of 1934, as amended, and applicable rules thereunder, that were            not pre-approved by the Committee, must be approved by the Committee            prior to the completion of the audit. Pre-approval by the Committee            is not required for engagements entered into pursuant to (a)pre-approval            policies and procedures established by the Committee, or (b)pre-approval            granted by one or more members of the Committee to whom, or by asubcommittee            to which, the Committee has delegated pre-approval authority,provided            in either case, that the Committee is informed of each such service            at its next regular meeting.*(e) (2) Percentages of Services*            One hundred percent of the services described in each of paragraphs            (b) through (d) were approved by the audit committee pursuant toparagraph            (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.*(f) Not applicable.**(g) Not applicable.**(h) Not applicable.*

**CONTROLS ANDPROCEDURES**

Exempt pursuant to Section 405 of the Sarbanes-Oxley            Act of 2002.

 

**EXHIBITS**

Exhibits included with this filing:            (a) Code of Ethics.

 (b) Certifications.            (1) Nicholas Kaiser, President, Saturna Investment Trust            (2) Christopher Fankhauser, Treasurer, Saturna Investment Trust

 
*November 30,                2003 Annual Report***** *41*
**SIGNATURES**

Pursuant to the requirements of the SecuritiesExchange            Act of 1934 and the Investment Company Act of 1940, the registrant            has duly caused this report to be signed on its behalf by theundersigned,            thereunto duly authorized.**SATURNA INVESTMENT TRUST**            By:            /s/ Nicholas Kaiser            Nicholas Kaiser, President             Date: January 28, 2004            Pursuant to the requirements of the Securities Exchange Act of 1934            and the Investment Act of 1940, this report has been signed below            by the following persons on behalf of the registrant and in thecapacities            and on the dates indicated.

By:            /s/ Nicholas Kaiser            Nicholas Kaiser, President             Date: January 28, 2004

            By:            /s/ Christopher Fankhouser             Christopher Fankhouser, Treasurer            Date: January 28, 2004

  
*42* *November                  30, 2003 Annual Report*****