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, 2004  Date of reporting period: November 30, 2004

**
 
**

**Item 1. Reports to Stockholders.**

| Sextant

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

Fellow Shareowners:**2004, like 2003, was a profitable year for securitiesinvestors**.  Stocks provided solid gains, while the bond markets markedtime as interest rates slowly rose.

Buoyed by consumer spending, more tax cuts, electioneering, and a very weakU.S. dollar, corporate earnings continued strong. Inflation, fueled by energycosts, began to rise. Consumer confidence is strong, buoyed by rising incomes.We expect the overnight bank rate to rise another 1% over the next year, and thered-hot housing sector is already feeling the chill. Economic growth is expectedto continue into 2005, as businesses increase investment spending.

However, a number of our most closely watched stock market indicators areflagging caution, and we warn stock market investors to expect lesser returns in2005.  The no-load Sextant Funds are designed to address a broad spectrum ofinvestment needs. Again in 2004, Fund returns increased with higher risks, justas expected. All stress low operating expenses and employ a "fulcrum"advisory fee structure that rewards or penalizes Saturna Capital for investmentresults. For the fiscal year ended November 30, 2004, comparative total returnsand percentile Morningstar category rankings (1 is best) are:
Sextant FundTotal Returnvs. MorningstarTotal Return12-mo. Rank (group size)*Short-Term Bond1.41%Short-Term Bonds1.88%63 (323)Bond Income4.26%Long-Term Bonds6.12%79 (65)Growth11.35%Mid-Cap Growth10.71%49 (799)International17.11%Foreign Large Blend21.91%87 (489)
Further information on each Fund is found in the followingsections of this report. Operating expenses are well below industry averages.Further, the adviser has undertaken to entirely waive its affiliate’sportfolio equity brokerage commissions for calendar 2005. In the footnotes, youwill notice another unusual feature of the Sextant funds: on average, over 22%of each Sextant Fund is owned by the trustees, officers, and their immediatefamilies. Our portfolio managers welcome your comments and suggestions. Weinvite 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,    2004 - please see next page for more performance information, or see back    of brochure for Morningstar disclosure.

December 23, 2004
*November            30, 2004 Annual Report* *1*
*Additional Performance Information*
**Average Annual Total Returns** (as of12/31/2004)1 year5 years10 years ORSince inception        on 9/28/1995Sextant Growth Fund16.44%2.37%12.44%^Sextant International Fund17.40%1.39%8.93%Sextant Short-Term Bond Fund0.96%5.23%5.08%Sextant Bond Income Fund4.52%8.07%7.30%*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 performance changes over time andcurrently                may be significantly    lower than stated. Recent performance and Morningstar rating data ispublished    online at each month’s end. Please visit saturna.com or call Saturna    Capital for current performance 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 involvegreater    risk, including political and economic uncertainties of foreign countries    as well as the risk of currency fluctuations.**Morningstar, Inc. is an independent fund performance              monitor. Rankings are determined monthly from total returns by              Morningstar, by category as determined by Morningstar. The overall              Morningstar              rating for a fund is derived from a weighted average of theperformance              figures associated with its 3-, 5-, and 10-year (if applicable)              Morningstar Rating. The average total return for a category is              determined by              Saturna Capital, utilizing the Morningstar database. Results are              shown for twelve months because the Sextant Funds’performance              fees are based on the same period.*
**REPORT OF REGISTEREDINDEPENDENT              PUBLIC ACCOUNTING FIRM**

          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, 2004, and the related statements of operations for the year then          ended, and the changes in net assets for each of the two years in the          period then ended, and the financial highlights for each of the five          years in the period then ended. These financial statements andfinancial          highlights are the responsibility of the Trust’s management.          Our responsibility is to express an opinion on these financialstatements          and financial highlights based on our audits.           We conducted our audits in accordance with the standards of the Public          Company Accounting Oversight Board (United States). Those standards          require that we plan and perform the audit to obtain reasonableassurance          about whether the financial statements and financial highlights are          free of material misstatement. An audit includes examining, on a test          basis, evidence supporting the amounts and disclosures in thefinancial          statements. Our procedures included confirmation of securities owned          as of November 30, 2004, by correspondence with the custodian. Our          audit also includes assessing the accounting principles used andsignificant          estimates made by management, as well as evaluating the overallfinancial          statement presentation. We believe that our auditsprovide 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, 2004,          the results of their operations for the year then ended, and thechanges          in their net assets for each of the two years in the period then ended          and their financial highlights for each of the five years in theperiod          then ended, in conformity with accounting principles generallyaccepted          in the United States of America.

/s/ *Tait, Weller &Baker*

          Philadelphia, Pennsylvania          December 17, 2004
*2* *November 30, 2004            Annual Report*(graphic omitted)**SEXTANT            SHORT-TERM BOND FUND** ******INVESTMENTS**   *As of November 30,2004****Rating*******Issuer******Coupon/Maturity******FaceAmount******MarketValue******Percentage********* ***Banking*** ABankers Trust  sub notes8.25% due 5/1/2005$85,000$86,9763.9%A-Washington Mutual Financial8.25% due 6/15/200575,00076,8203.4%  *SUB-TOTAL*160,000163,7967.3%       ***Building Products*** A-Lowe's Companies7.50% due 12/15/200570,00072,7253.2%    ***Computer*** AA-Hewlett Packard7.15% due 6/15/200570,00071,3483.2%       ***Cosmetics & Toiletries*** AAvon Products6.55% due 8/1/200795,000101,1584.5%    ***Finance & Insurance*** AAllliance Capital Management5.625% due 8/15/200665,00066,7443.0%AAAFederal Home Loan Mortgage Corp3.00% due 8/18/2005100,000100,2394.4%BBB+General Motors Accp't Corp5.00% due 9/15/200950,00048,2292.1%A+International Finance AIG5.75% due 10/15/200695,00098,4964.4%A-Lincoln National Insurance7.25% due 5/15/2005100,000101,4374.5% ***SUB-TOTAL*410,000415,14518.4%    ***Machinery*** A-Rockwell Automation International6.15% due 1/15/200895,000100,2534.4%    ***Medical Drugs*** AAmgen6.5% due 12/1/200790,00095,3034.2%AAABristol Myers Squibb4.75% due 10/1/200690,00091,8254.1%AAAPfizer5.625% due 2/1/2006100,000102,9904.6%A-Wyeth7.90% due 2/15/200575,000 75,3783.3%  *SUB-TOTAL*355,000365,49616.2%    ***Oil & Gas*** BBB+Union Oil of California7.20% due 5/15/2005100,000 101,7974.5%    ***Publishing*** A-Tribune6.875% due 11/1/200645,00047,4242.1%       ***Telecommunications*** AA-Southwestern Bell6.625% due 7/15/200795,000101,7444.5%A-Verizon Wireless Capital5.375% due 12/15/2000682,00084,3383.7%  *SUB-TOTAL*177,000186,0828.2%    ***Utilities*** AA-Florida Power & Light6.875% due 12/1/200595,00098,1554.4%BBBPSI Energy7.85% due 10/15/200790,00098,7484.4%A-Sempra Energy6.95% due 12/1/200592,00094,7044.2%  *SUB-TOTAL*277,000291,60713.0%   **Total Investments****(Cost = $1,991,482)****$1,854,000****$1,916,831****85.0%****Other Assets (net of liabilities)** **338,576****15.0%****Total Net Assets** **$2,255,407****100.0%****Ratings are the lesser of S&P orMoody's            (unaudited)**November            30, 2004 Annual Report* *3*(Graphic          Omitted)**FINANCIAL          HIGHLIGHTS** 
**SEXTANTSHORT-TERM              BOND FUND***Selected data per share of capital stock          outstanding        throughout the year***For Year Ended November 30,**  **2004****2003****2002****2001****2000****Net asset value at beginning of year** **$5.09****$5.07****$5.10****$4.95****$4.92***Income from investment operations*      Net investment income  0.19 0.23 0.27 0.26 0.27 Net gains or losses on securities (both realized andunrealized) (0.12)0.02 (0.02) 0.14 0.03 **Total from investment operations**  0.07 0.25 0.25 0.40  0.30 *Less distributions*      Dividends (from net investment income)  (0.19) (0.23) (0.28) (0.25) (0.27)Total distributions  (0.19) (0.23) (0.28) (0.25) (0.27)**Net asset value at end of year** **$4.97****$5.09****$5.07****$5.10****$4.95****Total Return** **1.41%****5.00%****4.90%****8.37%****6.20%**       Ratios / Supplemental Data      Net assets ($000), end of year $2,255$2,259$2,177$2,189$2,555 **Ratio of expenses to average netassets**      Before  fee waiver 1.14%1.17%1.14%0.94%1.02%After  fee waiver 0.58%0.60%0.93%0.51%0.61%Ratio of net investment income after waivers to average        net assets 3.80%4.47%5.23%5.45%5.45%       **Portfolio turnover rate********37%****22%****28%****28%****12%**
**STATEMENT OFASSETS              AND LIABILITIES**
*As of November 30, 2004*    **Assets**   Bond investments (Cost $1,991,482) $1,916,831Cash 304,197Interest receivable 35,117Due from affiliates 3,320 Total Assets$2,259,465**Liabilities** Other Liabilities 4,058 Total Liabilities4,058  **Net Assets** $2,255,407  **Fund shares outstanding** 454,105  **Analysis of Net Assets** Paid in Capital (unlimited shares authorized, without par        value) 2,284,003Accumlated net realized loss (33,945)Unrealized net appreciation on investments 5,349 Net Assets applicable to Fund shares outstanding$2,255,407**Net Asset Value, Offering and Redemption price pershare** **$4.97**

*(The accompanying notes are an integral part of these        financial statements)*
*4* *November 30, 2004              Annual Report***SEXTANTSHORT-TERM            BOND FUND**  
**STATEMENT OF              OPERATIONS**(Graphic              Omitted)****  *For the year ended November 30, 2004***Investment Income**   Interest income $134,538Amortization of bond premium (31,333)Accretion 1,631Miscellaneous income 30  Gross investment income$104,866  **Expenses** Investment adviser and administration fees 15,034Custodian fees 2,857Audit  fees 2,772Filing and registration fees 2,680Legal fees 1,912Insurance 1,191Printing and postage 566Trustee fees 353Other expenses 205Total gross expenses 27,570Less adviser fees waived (11,573)Less custodian fees waived (2,047)Net expenses 13,950 Net investment income90,916  **Net realized loss on investments** Proceeds from sales 843,188Less: cost of securities sold based on identifiedcost 847,610 Realized net loss(4,422)  **Unrealized gain on investments** End of year 5,349Beginning of year 62,732Decrease in unrealized gain for the year (57,383) Net realized and unrealized loss(61,805)**Net increase in net assets resulting fromoperations****$29,111**
*(The accompanying notes are an integral part of these        financial statements)*
*November 30, 2004Annual            Report* *5*****(Graphic          Omitted) **STATEMENT          OF CHANGES IN NET ASSETS** 
**SEXTANTSHORT-TERM              BOND FUND****** **Year ended****Year ended** **Nov. 30, 2004****Nov. 30, 2003****INCREASE (DECREASE) IN NET ASSETS**  ***From Operations***  Net investment income$90,916$101,861Net realized gain (loss) on investments(4,422)6,196Net decrease in unrealized appreciation(57,383)(795)Net increase in net assets29,111107,262 ***Dividends to shareowners from***Net investment income(90,916)(101,962) ***Fund Share transactions***Proceeds from sales of shares610,686551,793Value of shares issued in reinvestment ofdividends90,739100,884 701,425652,677Cost of shares redeemed(643,510)(575,737)Net increase in net assets57,91576,940**Total increase (decrease) in net assets****(3,890)****82,240** **NET ASSETS**Beginning of year2,259,2972,177,057End of year$2,255,407$2,259,297 **Shares of the fund sold and redeemed**Number of shares sold119,937107,305Number of shares issued in reinvestment of dividends18,01319,603 137,950126,908Number of shares redeemed(127,472)(112,516)**Net increase in number of shares outstanding****10,478****14,392**
*(The accompanying notes are an integral part of these        financial statements)*
**DISCUSSION            OF SEXTANT SHORT-TERM BOND FUND PERFORMANCE**

(unaudited)
**FISCAL YEAR2004**For the fiscal year ending November 30, 2004, the Sextant Short-Term Bond  Fund provided a total return of 1.45%. The share price moved in a range of  $4.96 to $5.12, a maximum variation of 3.2%. The current thirty-day SEC yield  rose to 3.27% from 2.65% at this time last year, consistent with risingshort-term  rates. The Fund ranked in the top 63% of 323 funds in the Morningstar“Short-term  Bond” category. At November 30, 2004, the Fund's overall Morningstar  category rating was 4-star, and “"above average"” for  returns and “"average"for risk (see Morningstar, page 35).

The Fund's annual expense ratio decreased to 0.58% from 0.60%,  reflecting management fee performance adjustments and the adviser's voluntary  expense cap. 

**FACTORS****AFFECTING PAST PERFOMANCE**    Over the last twelve months, the Federal Reserve reversed its accommodative      policy and raised the Federal Funds rate from 1.00% to 2.25% in“"measured"” response      to a growing economy. Credit spreads narrowed further due to strongprofits.      Investment grade credits generally outperformed US Treasuries with similar      maturities. The Fund remained overweight in investment grade corporate      notes and added positions in US government agency paper.
*6* *November 30, 2004              Annual Report*
 Fund returns suffered slightly from a shorter than normal    average maturity and a flattening yield curve where short maturity paper    underperformed long maturity paper. Portfolio holdings table at November    30, 2004:
Ratings         established By         AdvisorBy Standard & Poor'sBy Moody's         Investor ServicesAAA9.0%0.0%9.0%AA3.4%12.4%7.8%A54.2%53.2%49.9%BBB18.7%15.3%18.7%unrated--4.4%0.0%cash14.7%14.7%14.7%
For the last five years, the Fund earned 5.22% annualizedtotal return, ranking in the top 31% of 174 funds in its Morningstar category.

**LOOKINGFORWARD**  We expect the US economy to grow 2% to 4% in 2005, and corporate profits toincrease 7% to 14%.  We expect the Federal Reserve to increase short-term ratesto 3.5% and the yield curve to flatten further.  The collapse of the US dollar,rising gold, commodity and energy prices all threaten future inflation.Continuing economic globalization limits the impact of these forces on domesticinflation.  This could mean another year of positive real returns for theFund.

**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 the Morningstar category Short-Term Bond. The  Fund's 12-month return (1.45%) was within one percent of the Morningstaraverage  (1.88%) on November 30, 2004. Therefore, no performance adjustment was made  to the basic 0.60% annual management fee for the month of December 2004. 

**COMPARISON TOINDEX**  Comparison of any mutual fund to a market index must be made bearing in mindthat the Index is unmanaged, and expense-free.  The graph below compares $10,000invested in the Fund at its inception in September 1995, compared to a similaramount invested in the Salomon Brothers Gov/Corp Investment Grade Bond Index formaturities between one and three years.  The graph shows that a $10,000investment made on September 1995 would have risen to $15,818 in the Fund and$16,509 in the Index.  The returns shown do not reflect the deduction of incometaxes that an investor could pay on income received or the sale of profitableinvestments. 

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

Fund Average Annual Returns    One Year 1.41%    Five Year 5.22%    Since Inception 5.12% 

*(graph omitted)*

 
*November 30, 2004Annual            Report* *7*
**SEXTANT SHORT-TERM BOND FUND            EXPENSES (unadited)**As a Sextant Short-Term Bond Fund shareowner, you incur ongoingcosts, including management fees and other fund expenses. Unlike many mutualfunds, you do not incur sales charges (loads) on purchase payments, reinvesteddividends, or other distributions. Nor do you incur redemption fees, exchangefees, or fees related to Individual Retirement Accounts. You may incur feesrelated to extra services requested by you for your account, such as bankwires.**EXAMPLE**      The example is based on an investment of $1,000 invested at the beginningof the fiscal year and held for the entire year [Friday, November 28, 2003 toTuesday, November 30, 2004].**ACTUAL EXPENSES**        The first line provides information about actual account values andactual expenses. You may use the information in this line, together with theamount you have invested, to estimate the expenses that you paid over theperiod. Simply divide your account value by $1,000 (for example, a $9,400account value divided by $1,000 = 9.4), then multiply the result by the numberin the first line under heading entitled “Expenses Paid During Year”to estimate the expenses you paid on your account during this fiscal year. TheFund also charges the following fees for extra services rendered on request,which you may need to add to determine your total expenses: $10 per checkbook,$25 per bank wire, $15 per overnight courier delivery.**HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES**      The second line provides information about hypothetical account values andhypothetical expenses based on the Fund’s actual expense ratio (based onthe last six months) and an assumed rate of return of 5% per year beforeexpenses, which is not the Fund’s actual return. The hypothetical accountvalues and expenses may not be used to estimate the actual ending accountbalance or expenses you paid for the year. You may use this information tocompare the ongoing costs of investing in the Fund and other funds. To do so,compare this 5% hypothetical example with the 5% hypothetical examples thatappear in the shareowner reports of the other funds. You may wish to add otherfees that are not included in the expenses shown in the table, such as IRA fees(there are no IRA fees with the Sextant Funds), and charges for extra servicessuch as check writing and bank wires.

Please note that the expenses shown are meant to highlight your ongoingcosts only and do not reflect any transactional costs, such as sales charges(loads), redemption fees, or exchange fees (note that the Sextant Funds do nothave any such transactional costs). Therefore, the second line is useful incomparing ongoing costs only, and may not help you determine the relative totalcosts of owning different funds. 

**SEXTANT SHORT-TERM BOND FUND**
Beginning AccountValue            [Friday, November 28, 2003]Ending AccountValue             [Tuesday, November 30, 2004]Expenses PaidDuring Period*Actual            (1.41% return             after expenses)$1,000.00$1,014.10$5.64Hypothetical            (5% return             before expenses)$1,000.00$1,044.40$5.72
* Expenses are equal to Sextant Short-Term Bond Fund's          annualized expense ratio of 0.56% (based on the most recentsemi-annual          period of June 1, 2004 through November 30, 2004), multiplied by the          average account value of $1,007.25 over the period.
*8* *November 30, 2004 Annual Report*
 
**INVESTMENTS** 
****SEXTANT                  BOND INCOME FUND****(Graphic                  Omitted)   *As of November 30,2004****Rating*******Issuer******Coupon/Maturity******Face Amount******Market Value******Percentage***    ***Automotive*** BBBAuto Zone5.50% due 11/15/2015$95,000$91,9963.5%       ***Banking*** A+Chase Manhattan7.125% due 6/15/200950,00055,4992.1%A+Citicorp7.25% due 10/15/201150,000 57,7812.2%A-Comerica Bank7.125% due 12/1/201350,000 53,9232.1%A+Norwest Financial6.85% due 7/15/200950,000 55,5012.1%  *SUB-TOTAL*200,000 222,7048.5%    ***Building Products*** BBB+Masco Corporation7.125% due 8/15/201360,00068,2782.6%    ***Chemicals*** A-Air Products & Chemicals8.75% due 4/15/202150,00061,7462.3%    ***Diversified Financial Services*** AAAGeneral Electric Capital 8.125% due 5/15/201260,00072,2032.7%    ***Electric Utilities*** A-Commonwealth Edison7.50% due 7/1/201350,000 58,4512.2%    ***Electronics*** A-Koninlijke Phillips Electronics 7.25% due 8/15/201350,000 56,4822.1%BBB+Sempra Energy7.95% due 3/1/201050,00057,1202.2%  *SUB-TOTAL*100,000113,6024.3%    ***Food*** BBB+Conagra7.875% due 9/15/201050,000 58,5452.2%A+Hershy Foods6.95% due 8/15/201250,00057,1812.2%A-HJ Heinz6.00 % due 3/15/201275,00080,4013.1%  *SUB-TOTAL*175,000196,1277.5%    ***Insurance*** A+Allstate7.50% due 6/15/201350,000 57,1002.2%AProgressive 7.00% due 10/1/201375,00082,8083.1%A+XL Capital6.50% due 1/15/201290,00098,3203.7%  *SUB-TOTAL*215,000238,2289.0%    ***Investment Finance*** ABear Stearns3.5% due 6/27/2008100,00093,3553.5%AA-Morgan Stanley Dean Witter6.75% due 10/15/201350,00055,2212.1%AAPaine Webber Group7.625% due 2/15/201450,000 58,3272.2%  *SUB-TOTAL*200,000 206,9037.8%*November 30, 2004Annual Report* *9***INVESTMENTS** 
****SEXTANT                  BOND INCOME FUND****(Graphic                  Omitted)***Rating*******Issuer******Coupon/Maturity******Face Amount******Market Value******Percentage***    ***Machinery*** ACaterpillar9.375% due 8/15/2011$40,000$51,0051.9%A+Dover6.25% due 6/1/200870,00074,7382.8%  *SUB-TOTAL*110,000125,7434.7%    ***Medical Supplies*** A+Becton Dickinson7.15% due 10/1/200940,000 44,7251.7%    ***Oil & Gas*** ABaker Hughes6.00% due 2/15/200970,00074,4112.8%AA-Texaco Capital8.625% due 6/30/201040,000 48,2641.8%  *SUB-TOTAL*110,000122,6754.6%    ***Real Estate*** BBB+Archstone Smith5.625% due 8/15/201450,000 49,8951.9%       ***Retailing*** ADayton Hudson (Target Stores)10.00% due 1/1/201150,000 63,8182.4%ALowe's Companies8.25% due 6/1/201050,000 58,8972.2%A-May Department Stores8.00% due 7/15/201250,000 58,3462.2%AAWal-Mart Stores7.25% due 6/1/201345,00052,4622.0%  *SUB-TOTAL*195,000 233,5238.8%    ***Telecommunications*** AA-GTE6.90% due 11/1/200850,00053,8422.0%    ***Transportation*** BBB+Southwest Airlines6.50% due 3/1/201275,00082,4833.1%A-US Freightways 8.50% due 4/25/201050,000 57,6902.2%  *SUB-TOTAL*125,000 140,1735.3%    ***US Government*** AAAFederal Home Loan Mortgage Corp5% due 8/1/2009100,000100,1263.8%AAAFederal National Mortgage Association5% due 4/10/2015100,00099,4553.8%AAAUS Treasury Note5.50% due 2/15/2008225,000239,8349.1%  *SUB-TOTAL*425,000439,41516.7%   ***Total Investments*****(Cost = $2,379,701)****$2,310,000****$2,540,229****96.1%****Other Assets (net of liabilities)** **102,371****3.9%*****Total Net Assets*** **$2,642,600****100.0%**  *Ratings are the lesser of S&P or Moody's (unaudited)          *10* *November 30, 2004 Annual Report*******FINANCIAL              HIGHLIGHTS** 
**SEXTANT BOND                INCOME FUND**(graphic                omitted)Selected data per share of capital stock outstanding        throughout the year**For Year Ended November 30,**  **2004****2003****2002****2001****2000****Net asset value at beginning of year** **$5.07****$4.97****$4.81****$4.56****$4.59**Income from investment operations      Net investment income  0.22 0.22 0.26 0.30 0.29 Net gains or losses on securities (both realized and          unrealized)  (0.01) 0.10 0.16 0.25 (0.03)Total from investment operations  0.21 0.32 0.42 0.55 0.26 *Less distributions*      Dividends (from net investment income)  (0.22) (0.22) (0.26) (0.30) (0.29)Total distributions  (0.22) (0.22) (0.26) (0.30) (0.29)**Net asset value at end of year********$5.06****$5.07****$4.97****$4.81****$4.56**       **Total return********4.26%****6.52%****9.02%****12.40%****6.05%**       Ratios/supplemental data      Net assets ($000), end of year  $2,643 $2,272 $2,105 $1,965 $1,505 **Ratio of expenses to average netassets**      Before fee waiver 0.89%1.15%1.06%1.06%0.99%After fee waiver 0.87%0.97%0.72%0.34%0.35%Ratio of net investment income after waiver to average          net assets 4.47%4.29%5.40%6.71%6.58%       **Portfolio turnover rate********0%****0%****29%****30%****0%**
**STATEMENT OF                ASSETS AND LIABILITIES***As of November 30, 2004*       **Assets**   Bond investments (cost $2,379,701) $2,540,229Cash 58,840Interest receivable 43,691Due from affiliates 2,457Insurance reserve premium 400 Total Assets$2,645,617**Liabilities** Other Liabilities 3,017 Total Liabilities3,017**Net Assets** **$2,642,600**    **Fund Shares Outstanding** 522,676    **Analysis of Net Assets** Paid in capital (unlimited shares authorized, without          par value) 2,515,913Accumlated net realized loss  (33,841)Unrealized net appreciation on investments 160,528 Net Assets applicable to Fund shares outstanding$2,642,600**Net Asset Value, Offering and Redemption price per            share****** **$5.06**
*(The accompanying notes are an integral part of thesefinancial      statements)*
*November 30, 2004Annual Report* *11*(graphic          omitted)**SEXTANT BOND          INCOME FUND** 
**STATEMENT OF              OPERATIONS****** *For the year ended November 30, 2004***Investment income**   Interest income $145,106Amortization of bond premium (12,233)Accretion 466 Gross investment income$133,339**Expenses** Investment adviser and administration fees 10,560Audit fees 2,682Filing and registration fees 2,488Insurance 2,019Legal fees 1,968Custodian fees 1,437Printing and postage 619Trustee fees 430Other expenses 160Total gross expenses 22,363Less custodian fees waived (667)Net expenses 21,696 Net investment income111,643**Unrealized gain on investments** End of year 160,528Beginning of year 169,117Decrease in unrealized gain for the period (8,589) Net realized and unrealized loss(8,589)**Net increase in net assets resulting fromoperations************$103,054**
 
**STATEMENT OF            CHANGES IN NET ASSETS** 
 **Year ended****Year ended** **Nov. 30, 2004****Nov. 30, 2003****INCREASE IN NET ASSETS**  ***From Operations***  Net investment income$111,643$97,023Net realized gain on investments--Net increase (decrease) in unealized appreciation(8,589)45,734Net increase in net assets 103,054142,757 ***Dividends to shareowners from***Net investment income(111,643)(97,200) ***From tund share transactions***Proceeds from sales of shares418,675187,626Value of shares issued in reinvestment of dividends106,57091,934 525,245279,560Cost of shares redeemed(146,179)(158,167)Net increase in net assets 379,066121,393**Total increase in net assets****$370,477****$166,950** **NET ASSETS**Beginning of year2,272,1232,105,173End of year$2,642,600$2,272,123 **Shares of the fund sold and redeemed**Number of shares sold82,69936,687Number of shares issued in reinvestment of dividends20,98517,851 103,68454,538Number of shares redeemed(29,190)(30,137)**Net increase in number of shares outstanding****74,494****24,401**
*(The accompanying notes are an integral part of thesefinancial      statements)*
*12* *November 30, 2004 Annual Report***DISCUSSION            OF SEXTANT BOND INCOME FUND PERFORMANCE**
(unaudited)
**FISCAL YEAR2004**  For the fiscal year ending November 30, 2004, the Sextant Bond Income Fund    returned 4.34%. At the end of the fiscal year, the Fund ranked in the top    79% of the 65 funds in the Morningstar “"Long-term Bond"category.    At November 30, 2004, the Fund's overall Morningstar category rating    was 2-star, and “"average" for returns and"average" for    risk (see Morningstar, page 35). 

The Fund's annual expense ratio decreased to 0.87% from 0.97%,    reflecting management fee performance adjustments and growth in assets. The  Fund's current thirty-day SEC yield is 3.73%, less than the 4.01% at  the end of last year. 

**FACTORS AFFECTINGPAST PERFORMANCE**  Under normal circumstances, the Fund's policy is to maintain a dollar-weighted    average maturity of ten years or more. However, with interest rate levels    lower 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 rampant, the Fund's average effective    maturity is conservatively being kept to less than 8 years. While we were    early in reducing the average maturity, the Fund is now well-protectedshould    the expected rise in interest rates materialize. The majority of the Fund's    recent performance comes from an average portfolio maturity that was less    than its Morningstar category during an extended period of low, long-term    interest rates. 

The table provides a summary of portfolio holdings as ofNovember 30, 2004:
Ratings established By          Advisor        By Standar &          Poor's        By Moody's          Investor Services        AAA19.4%15.6%19.4%AA10.4%8.2%12.5%A44.6%50.0%44.7%BBB22.1%18.9%19.9%unrated--3.8%0.0%cash3.5%3.5%3.5%
For the last five years, the Fund earned 5.22% annualizedtotal return, ranking in the top 31% of 174 funds in its Morningstar category.

**LOOKINGFORWARD**We expect the US economy to grow 2% to 4% in 2005, and corporate profitsto increase 7% to 14%. We expect the Federal Reserve to increase short-termrates to 3.5% and the yield curve to flatten further. The collapse of the USdollar, rising gold, commodity and energy prices all threaten future inflation.However, continuing economic globalization limits the impact of these forces ondomestic inflation. Investment-grade bond spreads are historically narrow,however we do not expect this sector to underperform U.S. Treasury bonds duringthe coming year. The Fund continues to overweight high-grade corporate debt, andis adding U.S. Government agency positions. We anticipate another year ofpositive real returns in 2005.

**MANAGEMENT FEECALCULATIONS**The Sextant Bond Income Fund calculates its management fee based  on a comparison 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 of  more than six years or an effective average maturity of more than tenyears."  The Fund's +4.26% 12-month return was below that of the index (+6.12%)  on November 30, 2004. Therefore, the basic 0.60%
*November 30, 2004Annual Report*** *13*    management fee was decreased by 0.10%, to 0.50%, for the month of December2004 because the Fund underperformed its benchmark index by more than 1% butless than 2%.
**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 theindex,    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    a wide 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 theinvestment    at the beginning of November 1994 would have risen to $20,637 in the Fund    and $21,028 in the Index. The September 1995 changes in this Fund'sinvestment    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)**

Fund Average Annual Returns    One Year 4.26%    Five Year 7.65%    Ten Year 7.51%  

*(graph omitted)*

 
*14* *November 30, 2004Annual Report***
**SEXTANT BOND INCOME FUNDEXPENSES          (unaudited)**As a Sextant Bond Income Fund shareowner, you incur ongoingcosts, including management fees and other fund expenses. Unlike many mutualfunds, you do not incur sales charges (loads) on purchase payments, reinvesteddividends, or other distributions. Nor do you incur redemption fees, exchangefees, or fees related to Individual Retirement Accounts. You may incur feesrelated to extra services requested by you for your account, such as bankwires.**EXAMPLE**      The example is based on an investment of $1,000 invested at the beginningof the fiscal year and held for the entire year [Friday, November 28, 2003 toTuesday, November 30, 2004].**ACTUAL EXPENSES**        The first line provides information about actual account values andactual expenses. You may use the information in this line, together with theamount you have invested, to estimate the expenses that you paid over theperiod. Simply divide your account value by $1,000 (for example, a $9,400account value divided by $1,000 = 9.4), then multiply the result by the numberin the first line under heading entitled “Expenses Paid During Year”to estimate the expenses you paid on your account during this fiscal year. TheFund also charges the following fees for extra services rendered on request,which you may need to add to determine your total expenses: $10 per checkbook,$25 per bank wire, $15 per overnight courier delivery.**HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES**        The second line provides information about hypothetical account valuesand hypothetical expenses based on the Fund’s actual expense ratio (basedon the last six months) and an assumed rate of return of 5% per year beforeexpenses, which is not the Fund’s actual return. The hypothetical accountvalues and expenses may not be used to estimate the actual ending accountbalance or expenses you paid for the year. You may use this information tocompare the ongoing costs of investing in the Fund and other funds. To do so,compare this 5% hypothetical example with the 5% hypothetical examples thatappear in the shareowner reports of the other funds. You may wish to add otherfees that are not included in the expenses shown in the table, such as IRA fees(there are no IRA fees with the Sextant Funds), and charges for extra servicessuch as check writing and bank wires.

Please note that the expenses shown are meant to highlight your ongoingcosts only and do not reflect any transactional costs, such as sales charges(loads), redemption fees, or exchange fees (note that the Sextant Funds do nothave any such transactional costs). Therefore, the second line is useful incomparing ongoing costs only, and may not help you determine the relative totalcosts of owning different funds. 

**SEXTANT BOND INCOMEFUND**
Beginning AccountValue          [Friday, November 28, 2003]Ending Account Value        [Tuesday, November 30, 2004]Expenses Paid DuringPeriod*Actual        (4.26% return         after expenses)$1,000.00$1,042.60$9.40Hypothetical        (5% return         before expenses)$1,000.00$1,040.80$9.39
* Expenses are equal to Sextant Bond Income Fund'sannualized        expense ratio of 0.92% (based on the most recent semi-annual period of        June 1, 2004 through November 30, 2004), multiplied by the averageaccount        value of $1,021.30 over the period.
*November 30, 2004Annual Report*** *15*
 
**INVESTMENTS** **SEXTANT              GROWTH FUND**(graphicomitted) *As of November 30,2004****Issue******Number ofShares******Cost******Market Value******Percentage******Common Stocks********************* ***Banking***Frontier Financial4,000 $90,207 $158,8003.0%Washington Mutual6,750 44,124  274,7925.2% *SUB-TOTAL*134,331433,5928.2%***Computers***3 Com*16,00096,57671,0401.3%Adobe Systems4,800 50,490 290,6885.4%Apple Computer*5,50097,170368,7756.9%Earthlink*12,000101,107130,0802.4%Hewlett-Packard4,00081,32080,0001.5%Intuit*3,000131,758125,5202.4%Oracle* 8,000 28,059101,9201.9%Phoenix Technologies Ltd.*3,062  29,148 24,8940.5% *SUB-TOTAL*615,6281,192,91722.3%***Construction***Lowe's Companies4,000135,141221,3204.1%Weyerhaeuser2,000  93,867  132,8002.5% *SUB-TOTAL*229,008353,3206.6%***Electronics***Advanced Micro Devices*10,00041,708212,8004.0%Agilent Technologies*4,000 108,894 91,5601.7%Harman International Industries1,500 114,354 184,7253.5% *SUB-TOTAL*264,956489,0859.2%***Food***Performance Food Group*3,00096,91778,7201.5%PepsiCo2,000 102,111 99,8201.9% *SUB-TOTAL*199,028178,5403.4% ***Hotels & Motels***Westcoast Hospitality*20,000138,152101,4001.9% ***Investments***Schwab (Charles)20,4159,117220,0744.1% ***Machinery***Regal-Beloit 2,000 52,106 56,4201.1% ***Medical***Affymetrix*3,00060,231101,8501.9%Amgen*2,64034,598158,5063.0%Barr Laboratories*4,500159,489175,1853.3%Bristol-Myers Squibb4,500121,892105,7502.0%Caremark Rx*4,00092,592143,0002.7%Ligand Pharmaceuticals*5,000 56,43056,0001.0%Lilly (Eli)2,000165,241106,6602.0%Pharmaceutical Product Development*7,500 67,174 315,8255.9% *SUB-TOTAL*757,6471,162,77621.8%***Metal Ores***Alcoa3,000104,233101,9401.9%Phelps Dodge1,330 76,218 129,2492.4% *SUB-TOTAL*180,451231,1894.3%***Oil &Gas***Noble*3,00054,457145,3502.7% ***Publishing***Dow Jones & Co.1,20054,79651,3001.0%Wiley (John) & Sons, Class A3,40074,233113,3902.1% *SUB-TOTAL*129,029164,6903.1%*16* *November 30, 2004              Annual Report***INVESTMENTS** **SEXTANT              GROWTH FUND**(graphicomitted)***Issue******Number ofShares******Cost******Market Value******Percentage*** ***Retail***Bed Bath & Beyond*3,000$100,051$119,7842.2%*******Telecommunications***Sprint (FON Group)1,30024,11429,6530.6%Trimble Navigation4,500106,214142,0652.7% *SUB-TOTAL*130,328171,7183.3% ***Utilities***FPL Group2,200134,107154,7262.9%Idacorp4,000105,499128,8802.4% *SUB-TOTAL*239,606283,6065.3% ***Total Investments*****$3,233,895****$5,304,461****99.5%****Other Assets (net of liabilities)****26,554****0.5%*****Total Net Assets*****$5,331,015****100.0%** *Non-income producing
 
*November 30, 2004Annual            Report* *17***FINANCIALHIGHLIGHTS** 
****SEXTANTGROWTH                FUND****(graphic                omitted)Selected data per share of capital stock outstanding      throughout the year**For Year Ended November 30,**  **2004****2003****2002****2001****2000****Net asset value at beginning of year** **$12.91****$10.64****$11.90****$13.16****$12.68**Income from investment operations      Net investment income  0.01 (0.04) (0.05) (0.02) (0.07)Net gains or losses on securities (both realized andunrealized)  1.45 2.31 (1.21) (1.24) 1.36Total from investment operations  1.46 2.27 (1.26) (1.26) 1.29*Less distributions*      Dividends (from net investment income)  (0.01) - - - -Distributions (from capital gains)  (0.16) - - - (0.81)Total distributions  (0.17) - - - (0.81)**Net asset value at end of period********$14.20****$12.91****$10.64****$11.90****$13.16****Total Return********11.35%****21.31%****(10.51)%****(9.57)%****10.16%**       Ratios / Supplemental Data      Net assets ($000), end of year $5,331$4,732$3,373$3,792$3,862 **Ratio of expenses to average netassets**      Before  fee waivers 0.80%1.20%1.17%0.84%1.11%After  fee waivers 0.78%1.14%1.11%0.78%1.05%Ratio of net investment income to average net assets 0.12%(0.40)%(0.48)%(0.18)%(0.51)%       **Portfolio turnover rate********8%****12%****15%****8%****20%******
**STATEMENT OFASSETS              AND LIABILITIES***As of November 30, 2004*       **Assets** Investments (cost $3,233,895) $5,304,461Cash 29,157Dividends receivable 2,839Insurance reserve premium 1,214****Total Assets$5,337,671**Liabilities** Due to affiliates 3,878Other liabilities 2,778****Total Liabilities6,656**Net Assets** **$5,331,015**    **Fund Shares Outstanding** 375,529    **Analysis of Net Assets** Paid in Capital (unlimited shares authorized, without par        value) 3,259,272Accumlated net investment income 1,177Unrealized net appreciation on investments 2,070,566****Net Assets applicable to Fund shares outstanding$5,331,015**Net Asset Value, Offering and Redemption price pershare****$14.20**
*(The accompanying notes are an integral        part of these financial statements)*
*18* *November 30, 2004              Annual Report*(Graphic          Omitted)**SEXTANTGROWTH          FUND**  
**STATEMENT OF              OPERATIONS****** ***For the year ended November 30, 2004*****Investment income**   Dividend income $44,734Miscllaneous income 9****Gross investment income$44,743**Expenses** Investment adviser and administration fees 18,702Audit fees 5,767Filing and registration fees 4,108Legal fees 3,863Custodian fees 2,718Insurance 2,496Printing and postage 1,338Trustee fees 760Other expenses 382Total gross expenses 40,134Less custodian fees waived (1,190)Net expenses 38,944****Net investment income5,799**Net realized gain on investments** Proceeds from sales 354,534Less cost of securities sold (based on identifiedcost) 262,875****Realized net gain91,659**Unrealized gain on investments** End of year 2,070,566Beginning of year 1,615,709Increase in unrealized gain for the year 454,857 Net realized and unrealized gain546,516**Net increase in net assets resulting fromoperations************$552,315****STATEMENT              OF CHANGES IN NET ASSETS** 
******** **Year ended****Year ended** **Nov. 30, 2004****Nov. 30, 2003****INCREASE IN NET ASSETS*****From Operations***Net investment income (loss)$5,799$(15,357)Net realized gain on investments91,65929,017Net increase  in unealized appreciation454,857815,393Net increase in net assets 552,315829,053*******Dividends to shareowners from***Net investment income(4,662)-Capital gains distributions(60,280)- (64,902)-*******From fund share transactions***Proceeds from sales of shares1,129,561764,452Value of shares issued in reinvestment of dividends64,879- 1,194,440764,452Cost of shares redeemed(1,082,914)(234,506)Net increase  in net assets 111,526529,946**Total increase  in net assets****$598,939****$1,358,999********NET ASSETS**Beginning of year4,732,0763,373,077End of year$5,331,015$4,732,076   Undistributed net investment income1,177-******Shares of the fund sold and redeemed**Number of shares sold87,75770,509Number of shares issued in reinvestment of dividends4,572-****92,32970,509Number of shares redeemed(83,204)(21,038)**Net increase  in number of sharesoutstanding****9,125****49,471**
*(The accompanying notes are an integral        part of these financial statements)*
*November 30, 2004Annual            Report* *19***DISCUSSION            OF SEXTANT GROWTH FUND PERFORMANCE**
(unaudited)
**FISCAL YEAR2004**  For the fiscal year ending November 30, 2004, the Sextant Growth Fund gained    11.18%. Stock prices continued to rise during 2004. For the fiscal year,    the broad S&P 500 Index gained a similar 11.85%, while thesmaller-company    NASDAQ Composite Index increased 7.50%. For the fiscal year, the Fund ranked    in the top 49% of the 799 funds in the Morningstar Mid-cap Growth category.    At November 30, 2004, the Fund's overall Morningstar category rating    was 4-star, and “"above average" for returns and“"below    average" for risk (see Morningstar, page 35). 

**FACTORS AFFECTING        PAST PERFORMANCE**  The economy in 2004 grew nicely.  Earnings per share of the S&P 500 Index  equities look to increase 20% for the calendar year, the best performancesince  1993. As illustrated in the table, our portfolio is heavily weighted withcomputer  (largest holdings Apple Computer and Adobe were up 221% and 47%, respectively)  and medical (largest holding Pharmaceutical Product Development up 42%)issues. Banking  issues were relatively weak, impacted by rising interest rates.
**Industries**Computers22.3%Medical21.8%Electronics9.2%Banking8.2%Construction6.6%Utilities5.3%Metals4.3%Investments4.1%Food3.4%Telecommunications3.3%Publishing3.1%Oil & Gas 2.7%Retail2.2%Miscellaneous (<2%)3.5%    The Fund seeks long-term growth through investment in common stocks of U.S.  domicled companies. It generally follows a value investment approach, favoring  companies with good fundamentals and relatively low price/earnings ratios.  This year's market recovery favored stocks of smaller companies andtechnology,  which had declined the most in the three-year bear market that ended in the  spring.
Income is not a consideration in portfolio selection;nevertheless,    numerous companies in our portfolio instituted or increased dividend payouts    in 2004.

**LOOKINGFORWARD**    The volatility, risks and returns of the stock market will continue.  The      poor stock market performances of 2000 through 2002 were reversed in 2003      and 2004 as stocks again provided investors with strong investmentreturns.      We are expecting a relatively weak stock market in 2005, at least in the      first half of the year.    Remember, a long-term approach is the best opportunity to prosper: for the    last ten years, the Fund provided a 12.10% average annualized total return    and ranks in the top 28% of 159 funds in its Morningstar peer category*.

**MANAGEMENT FEECALCULATIONS**  The Sextant Growth Fund calculates part of its management fee based on a      comparison of the Fund’s return to the average return inMorningstar's “Mid-Cap      Growth” category. At November 30, 2004, the one-year return for this      category average was +10.71%. Because the Fund's 12-month returnoutperformed      this average by less than 1% at November 30, 2004, the adviser earned no      bonus or penalty fee for the month of December 2004. The Fund’stotal      expense ratio, 0.78% was down substantially from 
**20** *November 30, 2004              Annual Report*    1.14% the previous year.  Like all mutual funds, Sextant Growth Fund’s  annual performance results are only stated after deduction of operatingexpenses.   The Fund is purchased directly by investors without any sales charges ordealers,  which eliminated the risk of ethical lapses discovered at somebroker-distributed  equity mutual funds in the last two years. Popular “mutual fundsupermarkets” operated  by major brokerage firms generally do not sell Sextant mutual funds, because  the adviser does not engage in “revenue sharing” with brokers or  distributors.
**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 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 aslimiting    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 widerange    of services. The graph below compares $10,000 invested in the Fund atNovember    30, 1994 (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 $31,348 versus $30,678 in the Index. The 1995 changes in thisFund’s    investment objectives and policies limit the usefulness of this comparison.

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

Fund Average Annual Returns    One Year 11.35%    Five Year 3.76%    Ten Year 12.10%  

*(graph omitted)*

 
**November                30, 2004 Annual Report** *21*
**SEXTANT GROWTH FUNDEXPENSES**As a Sextant Growth Fund shareowner, you incur ongoing costs,including management fees and other fund expenses. Unlike many mutual funds, youdo not incur sales charges (loads) on purchase payments, reinvested dividends,or other distributions. Nor do you incur redemption fees, exchange fees, or feesrelated to Individual Retirement Accounts. You may incur fees related to extraservices requested by you for your account, such as bank wires.**EXAMPLE**    The example is based on an investment of $1,000 invested at the beginning ofthe fiscal year and held for the entire year [Friday, November 28, 2003 toTuesday, November 30, 2004].**ACTUAL EXPENSES**      The first line provides information about actual account values and actual      expenses. You may use the information in this line, together with theamount      you have invested, to estimate the expenses that you paid over the period.      Simply divide your account value by $1,000 (for example, a $9,400 account      value divided by $1,000 = 9.4), then multiply the result by the number      in the first line under heading entitled “"Expenses Paid During      Year" to estimate the expenses you paid on your account during this      fiscal year. The Fund also charges the following fees for extra services      rendered on request, which you may need to add to determine your total      expenses: $10 per checkbook, $25 per bank wire, $15 per overnight courier      delivery.**HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES**      The second line provides information about hypothetical account values      and hypothetical expenses based on the Fund's actual expense ratio (based      on the last six months) and an assumed rate of return of 5% per yearbefore      expenses, which is not the Fund's actual return. The hypothetical      account values and expenses may not be used to estimate the actual ending      account balance or expenses you paid for the year. You may use thisinformation      to compare the ongoing costs of investing in the Funds and other fund.      To do so, compare this 5% hypothetical example with the 5% hypothetical      examples that appear in the shareowner reports of the other funds. You      may wish to add other fees that are not included in the expenses shown      in the table, such as IRA fees (there are no IRA fees with the Sextant      Funds), and charges for extra services such as check writing and bankwires.

Please note that the expenses shown are meant to highlightyour ongoing costs only and do not reflect any transactional costs, such assales charges (loads), redemption fees, or exchange fees (note that the SextantFunds do not have any such transactional costs). Therefore, the second line isuseful in comparing ongoing costs only, and may not help you determine therelative total costs of owning different funds. 

**SEXTANT GROWTHFUND**
Beginning AccountValue [Friday, November 28, 2003]Ending Account Value        [Tuesday, November 30, 2004]Expenses Paid DuringPeriod*Actual        (11.35% return         after expenses)$1,000.00$1,113.50$9.30Hypothetical        (5% return         before expenses)$1,000.00$1,041.20$8.98
* Expenses are equal to Sextant Growth Fund's annualized        expense ratio of 0.88% (based on the most recent semi-annual period of        June1, 2004 through November 30, 2004), multiplied by the averageaccount        value of $1,059.40 over the period.
**22** *November 30, 2004 Annual Report*
 
******INVESTMENTS** 
**SEXTANTINTERNATIONAL              FUND**(Graphic              Omitted) *As of November 30,2004****Issue******Number ofShares******Cost******Market Value******Country******Percentage******Common Stocks********************************* ***Aircraft********* Embraer Aircraft ADR1,713$38,169$47,913Brazil2.3%      ***Automotive********* Nissan Motor ADR2,00030,08542,000Japan2.0%  ***Banking and Financial*** Aegon NV ADR2,29219,73628,398Netherlands1.4%AXA ADS3,00059,78470,350France3.4%Banco Bilbao Vizcaya ADS1,8007,70229,484Spain1.4%ING Groep ADS1,52336,13441,776Netherlands2.0%Toronto-Dominion Bank1,40018,15956,294Canada2.8% *SUB-TOTAL*141,515226,302 11.0%***Building Materials*** CRH plc ADR2,00023,07550,040Ireland2.4%Hanson plc ADR1,10033,05544,242UK2.2%James Hardie Industries NV ADS1,00025,56122,350Australia1.1% *SUB-TOTAL*81,691116,632 5.7%***Computers*** Business Objects  ADS*6,00019,570139,680France6.8%Dassault Systems ADR1,00028,38051,590France2.5%Sina*1,20028,32544,316China2.2% *SUB-TOTAL*76,275235,586 11.5%***Consumer Products*** Allied Domecq plc1,20040,57648,024UK2.3%Coca-Cola Femsa ADS1,5009,75032,730Mexico1.6% *SUB-TOTAL*50,32680,754 3.9%***Electronics*** Epcos AG ADS2,50057,30739,800Germany1.9%Sony ADR1,00047,51736,370Japan1.8% *SUB-TOTAL*104,82476,170 3.7%***Hotels*** Fairmont Hotels & Resorts1,10024,38534,122Canada1.7%  ***Medical-Drugs*** Glaxo Smithkline plc ADR4009,80017,016UK0.8%Novartis AG ADR1,00045,17748,050Switzerland2.3%Serono SA ADR2,00029,76132,160Switzerland1.6% *SUB-TOTAL*84,73897,226 4.7%***Metals & Mining*** Potash Corp. of Saskatchewan1,00034,23476,580Canada3.7%Rio Tinto plc ADS50031,17558,795UK2.9% *SUB-TOTAL*65,409135,375 6.6%**November 30, 2004 Annual Report** *23***** (Graphic          Omitted)**SEXTANT          INTERNATIONAL FUND** 
**INVESTMENTS*****Issue******Number ofShares******Cost******Market Value******Country******Percentage***      ***Oil & Gas Production*** EnCana1,000$35,020$57,030Canada2.8%Repsol-YPF ADR2,00043,59248,720Spain2.4%Total Fina Elf ADR50021,86454,800France2.7% *SUB-TOTAL*100,476160,550 7.9%***Paper Products*** Metso ADS2,10022,80233,810Finland1.6%UPM-Kymmene Oyj ADS2,00034,39945,260Finland2.2% *SUB-TOTAL*57,20179,070 3.8%***Photographic Equipment*** Canon ADR1,00023,42650,170Japan2.4%Fuji Photo Film ADR40010,05014,092Japan0.7% *SUB-TOTAL*33,47664,262 3.1%**Real Estate** Intrawest 1,20021,84024,000Canada1.2%  ***Telecommunications*** America Movil ADR2,00029,72593,420Mexico4.6%BCE1,60030,11938,800Canada1.9%British Sky Broadcasting ADS45011,06319,152UK0.9%PT Indosat ADR1,00020,95231,840Indonesia1.6%SK Telecom ADS1,50027,76133,975Korea1.6%Telefonica ADS58612,05830,794Spain1.5%Telefonos de Mexico ADS1,00035,17035,010Mexico1.7% *SUB-TOTAL*166,848282,811 13.8%***Transportation*** Canadian Pacific Railway Ltd.1,20020,33839,288Canada1.9%Lan Airlines ADS3,50024,63695,585Chile4.7% *SUB-TOTAL*44,974134,873 6.6%***Utilities-Electric*** Enel ADS80035,37235,752Italy1.7%Enersis ADS4,00037,12529,880Chile1.5%Korea Electric Power ADS2,00031,96126,960Korea1.3% *SUB-TOTAL*104,45892,592 4.5%***Utilities-Gas*** Transport de Gas del Sur ADR*1,50018,8087,785Argentina0.4%  ***Total Investments*****$1,245,498****$1,938,023** **94.4%****Other Assets (net of liabilities)****114,539****5.6%*****Total Net Assets*****$2,052,562** **100.0%**  ** Non-income producing* 
**24** **November 30, 2004 AnnualReport****FINANCIAL HIGHLIGHTS** **SEXTANT                INTERNATIONAL FUND**(graphic                omitted)Selected data per share of capital stockoutstanding            throughout each year       **For Year Ended November 30,**  **2004****2003****2002****2001****2000****Net asset value at beginning of year** **$8.05****$6.07****$7.24****$8.52****$8.32**Income from investment operations      Net investment income  0.03 0.05 0.02 0.04 0.43Net gains or losses on securities (both realized              and unrealized)  1.35 1.97 (1.16) (1.30) 0.20Total from investment operations  1.38 2.02 (1.14) (1.26) 0.63*Less distributions*      Dividends (from net investment income)  (0.03) (0.04) (0.03) (0.02) (0.43)Distributions (from capital gains)  -  -  -  -  -Total distributions  (0.03) (0.04) (0.03) (0.02) (0.43)**Net asset value at end of year********$9.40****$8.05****$6.07****$7.24****$8.52**       **Total return********17.11%****33.23%****(15.80)%****(14.80)%****7.62%**       Ratios/supplemental data      Net assets ($000), end of year $2,053$1,650$1,150$1,445$1,736 **Ratio of expenses to average netassets**      Before  fee waivers 1.22%1.29%1.36%1.37%1.36%After  fee waivers 1.10%1.10%1.17%1.17%1.20%Ratio of net investment income after waiver toaverage              net assets 0.31%0.75%0.20%0.34%4.74%       **Portfolio turnover rate********7%****4%****4%****6%****11%**
 

**STATEMENT OFASSETS              AND LIABILITIES******    *As of November 30, 2004*       **Assets**   Investments (cost $1,245,498) $1,938,023Cash 117,060Dividends receivable 2,587****Total Assets$2,057,670**** **Liabilities** Other Liabilities 4,114Due to affiliates 994****Total Liabilities5,108**** **Net Assets** **$2,052,562****** ******Fund shares outstanding** 218,259**** **Analysis of Net Assets** Paid in Capital (unlimited shares authorized, without par        value) 1,533,361Accumulated net investment income 2,020Accumulated net realized loss (175,344)Unrealized net appreciation on investments  692,525****Net Assets applicable to Fund sharesoutstanding$2,052,562**** **Net Asset Value, Offering and Redemption price pershare****$9.40**
 

*(The accompanying notes are an integral        part of these financial statements)*
***November 30, 2004 AnnualReport*** **25**********(graphic          omitted)******SEXTANT          INTERNATIONAL FUND** 
**STATEMENT OF              OPERATIONS****** *For the year ended November 30, 2004*    **Investment income**   Dividend income (net foreign taxes of $4,734) $27,143Miscellaneous income 26 ****Gross investment income$27,169**** **Expenses** Investment adviser and administration fees 11,159Filing and registration fees 4,057Custodian fees 2,917Audit fees 2,204Legal fees 1,500Insurance 870Printing and postage 467Trustee fees 327Other expenses 139Total gross expenses 23,640Less custodian fees waived (2,405)Net expenses 21,235****Net investment income5,934**** **Net realized gain on investments** Proceeds from sales 121,344Less cost of securities sold (based on identifiedcost) 120,884****Realized net gain460**** **Unrealized gain on investments** End of year 692,525Beginning of year 413,043Increase in unrealized gain for the year 279,482 Net realized and unrealized gain279,942  **Net increase in net assets resulting fromoperations************$285,876**
 
******STATEMENT            OF CHANGES IN NET ASSETS**
******** **Year ended****Year ended** **Nov. 30, 2004****Nov. 30, 2003****INCREASE  IN NET ASSETS*****From Operations***Net investment income $5,934$9,508Net realized gain (loss) on investments460(30,670)Net increase  in unealized appreciation279,482418,990Net increase  in net assets 285,876397,828*******Dividends to shareowners from***Net investment income(5,876)(7,547)*******From fund share transactions***Proceeds from sales of shares652,936222,528Value of shares issued in reinvestment of dividends5,8637,529 658,799230,057Cost of shares redeemed(535,868)(121,076)Net increase in net assets from share transactions122,931108,981**Total increase in net assets****$402,931****$499,262********NET ASSETS**Beginning of year1,649,6311,150,369End of year$2,052,562$1,649,631******Undistributed net investment income**-1,962   **Shares of the fund sold and redeemed**Number of shares sold75,58932,286Number of shares issued in reinvestment of dividends624935 76,21333,221Number of shares redeemed(62,906)(17,938)**Net increase  in number of shares outstanding****13,307****15,283**
*(The accompanying notes are an integral part of these          financial statements)*
***26*** ***November 30, 2004 AnnualReport*****DISCUSSION              OF SEXTANT INTERNATIONAL FUND PERFORMANCE**
          (unaudited) 
**FISCAL YEAR2004**    For the fiscal year ended November 30, 2004, the Sextant International Fund      returned +17.11%. The comparable AMEX International Index did better,gaining      23.87%. At the end of this latest fiscal year, the Fund ranked in the 87th      percentile of the 489 funds in Morningstar’s peer Foreign LargeBlend      category†. Still, the Fund’s overall Morningstar categoryrating      was 4-star, and “average” for returns and “high”for    risk (see Morningstar, page 35).

**FACTORS AFFECTING          PAST PERFORMANCE**    The US dollar dropped precipitously during 2004, a risk that our foreigninvestments mitigates for US investors.  Fund is diversified across industriesand countries, as shown in these tables:
**Industries**  **Countries**Telecommunications13.8% Canada15.8%Computers11.5% France15.3%Banking11.0% United Kingdom 9.1%Oil & Gas7.9% Mexico7.8%Metals & Mining6.6% Japan6.9%Transportation6.6% Chile6.1%Building Materials 5.7% Cash5.6%Cash5.6% Spain5.3%Medical - Drugs4.7% Switzerland3.9%Utilities - Electric4.5% Finland3.8%Consumer Products3.9% Netherlands3.4%Paper & Products 3.8% Korea2.9%Electronics3.7% Ireland2.4%Photography3.1% Brazil2.3%Aircraft2.3% China2.1%Automotive2.0% Other (under 2%) 7.3%Other (under 2%) 3.3%   
Our portfolio is more heavily invested in Europe and Canada than Asia,        which generally hurt results. Commodity prices increased, bringingsubstantial        appreciation to our cyclical and resource-based issues. Computer issues        did well, but telecommunications (our largest industry) underperformed.        Banks also did poorly as interest rates increased and insurers suffered        from hurricanes and other losses. Oil and gas producers appreciatedsharply,        in response to the rise in energy prices.****
**November 30, 2004 Annual Report** *27*
**LOOKINGFORWARD**The Sextant International Fund is broadly diversified in growing companiesheadquartered outside the United States. We continue our focus on largercompanies, which tend to be more stable over time.

**MANAGEMENT FEECALCULATIONS**The Sextant International Fund calculates part of itsmanagement      fee based on a comparison of the Fund’s return to the average return      of the Morningstar fund category “Foreign Large Blend”. At      November 30, 2004, the one-year return for this category average was21.91%.      Because the Fund's 12-month return underperformed this average by more      than 4% at November 30, 2004, a performance penalty of 0.30% wassubtracted      from the basic 0.60% annual management fee for the month of December 2004.      The total expense ratio remained unchanged from the prior year at1.10%.

**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 amountinvested      in the AMEX International Index. This capitalization-weighted indexaverages      50 American Depository Receipts (ADRs) of large worldwide companies, and      reflects the types of securities in which Sextant International Fundinvests.      The graph shows that a $10,000 investment made on September 1995 would      have risen to $20,869 in the Fund and $14,645 in the Index.   

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

Fund Average Annual Returns      One Year 17.11%      Five Year 3.79%      Since Inception 8.34%    

*(graph omitted)*

 
*28* **November 30, 2004 Annual Report**
**SEXTANT INTERNATIONALFUND EXPENSES**As a Sextant International Fund shareowner, you incur ongoingcosts, including management fees and other fund expenses. Unlike many mutualfunds, you do not incur sales charges (loads) on purchase payments, reinvesteddividends, or other distributions. Nor do you incur redemption fees, exchangefees, or fees related to Individual Retirement Accounts. You may incur feesrelated to extra services requested by you for your account, such as bankwires.

**EXAMPLE**  The example is based on an investment of $1,000 invested at the beginning ofthe fiscal year and held for the entire year [Friday, November 28, 2003 toTuesday, November 30, 2004].

**ACTUAL EXPENSES**    The first line provides information about actual account values and actualexpenses. You may use the information in this line, together with the amount youhave invested, to estimate the expenses that you paid over the period. Simplydivide your account value by $1,000 (for example, a $9,400 account value dividedby $1,000 = 9.4), then multiply the result by the number in the first line underheading entitled “Expenses Paid During Year” to estimate theexpenses you paid on your account during this fiscal year. The Fund also chargesthe following fees for extra services rendered on request, which you may need toadd to determine your total expenses: $10 per checkbook, $25 per bank wire, $15per overnight courier delivery.

**HYPOTHETICAL EXAMPLE FOR COMPARISONPURPOSES**    The second line provides information about hypothetical account values andhypothetical expenses based on the Fund’s actual expense ratio (based onthe last six months) and an assumed rate of return of 5% per year beforeexpenses, which is not the Fund’s actual return. The hypothetical accountvalues and expenses may not be used to estimate the actual ending accountbalance or expenses you paid for the year. You may use this information tocompare the ongoing costs of investing in the Fund and other funds. To do so,compare this 5% hypothetical example with the 5% hypothetical examples thatappear in the shareowner reports of the other funds. You may wish to add otherfees that are not included in the expenses shown in the table, such as IRA fees(there are no IRA fees with the Sextant Funds), and charges for extra servicessuch as check writing and bank wires.

Please note that the expenses shown are meant to highlightyour ongoing costs only and do not reflect any transactional costs, such assales charges (loads), redemption fees, or exchange fees (note that the SextantFunds do not have any such transactional costs). Therefore, the second line isuseful in comparing ongoing costs only, and may not help you determine therelative total costs of owning different funds. 

**SEXTANT INTERNATIONALFUND**
Beginning AccountValue [Friday, November 28, 2003]Ending Account Value          [Tuesday, November 30, 2004]Expenses Paid DuringPeriod*Actual          (17.11% return           after expenses)$1,000.00$1,171.10$11.94Hypothetical          (5% return           before expenses)$1,000.00$1,039.00$11.44
* Expenses are equal to Sextant International      Fund's annualized expense ratio of 1.10% (based on the most recentsemi-annual      period of June 1, 2004 through November 30, 2004), multiplied by theaverage      account value of $1,085.55 over the period.
**November 30, 2004 Annual Report**  **29*****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 series investment company under        the Investment Company Act of 1940, as amended. Five portfolio series        have been created to date: Sextant Short-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.         The investment goals of the Growth and International Funds are long-term        capital growth. The investment goals of the Bond Income and Short-Term        Bond Funds are current income, with Short-Term Bond having theadditional        goal of capital preservation.
**Note 2 -*SignificantAccounting                Policies*****The following is a summary of the significant        accounting policies followed by the Funds.                
***Security Valuation:***          Investments in securities traded on a national securities exchange            (or reported on the NASDAQ national market) are stated at the last            reported sales price on the day of valuation; other securitiestraded            in the over-the-counter market and listed securities for which no            sale was reported on that date are stated at the last quoted bid            price. Securities for which quotations are not readily available            are adjusted to fair value as determined in good faith under the            supervision of the trustees.           Fixed-income securities for which there are no publicly availablemarket          quotations are valued using a matrix based on maturity, quality, yield          and similar factors, which are compared periodically to multipledealer          bids and adjusted by the adviser under fair value policies established          by the Trustees. The ability of issuers of debt securities held by          the Funds to meet their obligations may be affected by economic and          political developments in a specific country or region.***Federal income taxes:***          The Funds policies are to continue to comply with the requirements          of the Internal Revenue Code applicable to regulated investmentcompanies          and to distribute all their taxable income to their shareowners.Therefore,          no provisions for Federal income taxes are required. ***Reclassification of capital accounts:***          Accounting principles generally accepted in the United States ofAmerica          require that certain components of net assets relating to permanent          differences be reclassified between financial and tax reporting. These          reclassifications have no effect on net assets or net asset value per          share.***Dividends and distributions toshareowners:***          Dividends and distributions to shareowners, which are determined in          accordance with income tax regulations, 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 reinvest dividends anddistributions          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 United States of America requires          management to make estimates and assumptions that affect the reported          amounts of assets and liabilities and disclosure of contingent assets          and liabilities at the date of the financial statements and thereported          amounts of increases and decreases in net assets from operationsduring          the reporting period. Actual results could differ from thoseestimates.***Other:***          The cost of securities is the same for accounting and Federal income          tax purposes. Securities transactions are recorded on trade date...          Interest income is recognized on an accrual basis. Discounts andpremiums          on securities purchased are amortized, over the lives of therespective          securities. Cash dividends from equity securities are recorded asincome          on the ex-dividend date.           Expenses incurred by the Trust on behalf of the Fund (e.g.,professional          fees) are allocated to the Fund and the other Funds of the Trust on          the basis of relative daily average net assets. The Adviser has agreed          to certain limits on expenses, as described below.
**Note 3 -*Transactions with                Affiliated Persons*****Under a contract approved by shareowners on                        September 28, 1995, Saturna Capital Corporation provides                        investment advisory services and certain otheradministrative                        and distribution services to conduct Trust business.                        Each of the Funds pays the Adviser a base Investment                        Advisory and Administrative Services Fee of .60% ofaverage                        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. Performance Adjustment                        for Sextant Short-Term Bond Fund and Sextant Bond Bond                        Income Fund: For each month in which either of these Funds’ total investment return(change in net asset value plus all distributions reinvested) for the one yearperiod through that month outperforms or underperforms the total return of aspecified index for that period by 1% or more but less than 2%, the Base Feeis increased or decreased by the annual rate of .10% of the Fund’s averagedaily net assets for the preceding year. If the outperformance or underperformance is 2% or 
*30* *November 30,                2004 Annual Report*

more, then the adjustment is at the annual rate of .20%.          Performance adjustment for Sextant Growth Fund and SextantInternational            Fund: For each month in which either of these Fund’s total investment return(change in net asset value plus all distributions reinvested) for the one yearperiod through that month outperforms or underperforms the total return of aspecified index for that period by 1% or more but less than 2%, the Base Feeis increased or decreased by the annual rate of .10% of the Fund’s averagedaily net assets for the preceding year. If the outperformance or underperformance is 2% or more but less than 4%, thenthe adjustment is at the annual rate of .20%. If the outperformance or underperformance is 4% or more, the adjustment is atan annual rate of .30%.The Adviser has voluntarily undertaken to limit expenses of Sextant Short-TermBond Fund to 0.60% through March 31, 2005 and waives its investment advisoryand administrative fee as to Sextant Short-Term Bond Fund and Sextant BondIncomeFund completely so long as assets of either Fund are less than $2 million.For the year ended November 30, 2004, Sextant Short-Term Bond Fund incurredadvisoryexpenses of $15,034. Sextant Bond Income Fund and Sextant Growth Fund incurredadvisory expenses of $10,560 and $19,932, respectively. Sextant InternationalFund incurred advisory expenses of $11,159.In accordance with the expense waiver noted above, for the year ended November30, 2004, Saturna Capital waived $11,532 of the Sextant Short-Term Bond Fundadvisory fee.In accordance with the Funds’ custodian agreements with National City BankIndiana, for the year ended November 30, 2004, custodian fees for Short-TermBond, Bond Income, Growth, and International were $2,047, $667, $2,420, and$2,405,respectively. The custodian waived its fees for earnings credits.One trustee, who also serves as the president of the Trust, is a director andpresident of the Adviser. On November 30, 2004, the trustees, officers and theirimmediate families as a group owned 26.7%, 18%, 15.2% and 29% of the outstandingshares of Short-Term Bond, Bond Income, Growth and International,respectively.The four unaffiliated trustees receive $200 per Board or committee meetingattended,plus travel expenses. The Trust paid the Independent Trustees $2,400 to attendmeetings during the fiscal year. New regulations in 2004 required the Trust todesignate a Chief Compliance Officer; Mr. Winship was retained by the Trust andpaid $6,250 during the fiscal year. The other officers are paid by SaturnaCapital,and not the Trust.
         

Saturna Brokerage Services, Inc. (a discount brokerage            subsidiary of Saturna Capital Corporation) is a registered as abroker-dealer            and acts as distributor without compensation.             Saturna Brokerage Services is the primary stockbroker used to effect            portfolio transactions for Sextant Growth Fund and SextantInternational            Fund, and was paid $2,959 and $977, respectively in commissions at            discount rates during the year ended November 30, 2004. The adviser            has undertaken to waive all brokerage commissions charged by its            affiliate in calendar 2005.

**Note 4 -*Federal Income                  Taxes*****At November 30, 2004, Short-Term Bond had capital losscarryforwards          of $33,945, of which $766 expires in 2005, $4,467 expires in 2007,          $9,191 expires in 2008, $15,099 expires in 2009 and $4,422 expires          in 2011; 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; and International had capital          loss carryforwards of $175,344, of which $1,110 expires in 2008,$72,857          expires in 2009, $70,706 expires in 2010 and $30,671 expires in 2011,          subject to regulation. Prior to their expiration, such losscarryforwards          may be used to offset future net capital gains realized for federal          income tax purposes.          For the year ended November 30, 2004, the undistributed net investment          income on a tax basis for the Short-Term Fund, Bond Income Fund,Growth          Fund, and International Fund was $0, $0, $1,177, and $2,020,respectively.

**Note 5 -*Investments*****During the year ended November 30, 2004, Bond Incomepur-chased            $438,158 of securities and sold $0 of securities. Comparable figures            for Short-Term Bond are $843,188 purchased $802,812 sold; for Growth            $1,058,444 and $354,534; and for International, $263,949 and$121,344. 
**Note 6 -*Distribution to                  shareholders:*****The tax character of distributions paid during the year          ended November 30, 2004 and 2003 were as follows:

2004            Short-Term Bond Fund, Ordinary income: $90,914            Bond Income Fund, Ordinary income: $111,643            Growth Fund, Ordinary income: $4,622; Capital gains: $60,280            International Fund, Ordinary income: $5,876

2003Short-Term Bond Fund, Ordinary income: $101,962Bond Income Fund, Ordinary income: $97,200Growth Fund, Ordinary income: -; Capital gains: -International Fund, Ordinary income: $7,547

(continued on next page)

 

 

 

 

 

 

 

 

 

 

 
*November 30, 2004Annual            Report* *31*
**Note 6 -*continued***

As of November 30, 2004, components of distributable earnings    on a tax basis were as follows:
 Short-Term BondBond IncomeGrowthInternationalCost of investments$1,911,482$2,379,701 $3,233,895$1,245,498Gross tax unrealizedappreciation$21,029$168,333$2,292,268$781,803Gross tax unrealizeddepreciation(15,680)(7,805)(221,702)(89,278)Net tax unrealizedappreciation$5,349$160,528$2,070,566$692,525Undistributed ordinaryincome——1,1772,020Undistributed long-termcapital gain (loss)(33,945)(33,841)—(175,344)Total distributableearnings(33,945)(33,841)1,177(173,324)Total accumulatedearnings/(losses) $ (28,596)$126,687 $2,071,743$519,201
**RENEWAL OF INVESTMENT ADVISORYCONTRACTS  (unaudited)**

On September 20, 2004, the trustees of Saturna InvestmentTrust    approved continuation of the four Sextant Fund investment advisory andadministrative    services agreements with Saturna Capital Corporation. In doing so, the Board    considered a number of factors and made specific determinations relevant    to that approval.  In addition to information provided throughout the year, the trustees utilized  a comparison of performance and fees of all funds in each of the SextantMorningstar  categories. The trustees found such information helpful in establishingexpectations  regarding the performance of the adviser and whether to continue the advisory  contracts.  In their review, the trustees noted that the Funds offer a full range ofhigh-quality  investor services. An important factor in the consideration by the trustees  was the adviser’s ability and commitment to internally performshareowner  servicing, administration, accounting, marketing and distribution to maintain  quality servicing at a reasonable expense.  The trustees found that the investment performance of each of the Funds, both  in absolute numbers and relative to funds in their Morningstar categories,  was good. This was confirmed by their current Morningstar ratings.  The trustees reviewed the fees and expenses of the Funds. They noted that the  performance-based advisory fees are unusual in the industry and very fair and  reasonable to shareowners. They considered the fees charged by the adviser  to other kinds of accounts and the different services provided to thoseaccounts.  In addition, the trustees found the expense ratios less than those of similar  funds and to be advantageous to shareowners given the sizes of the funds,services  provided and expenses incurred. They took into consideration theadviser’s  avoidance of operational problems, such as those publicized at other mutual  funds in the last year. They noted that various Fund expenses, outside the  adviser’s control, were rising due to new mutual fund industryregulations.  The trustees found that the Sextant Funds continue to operate at a substantial  cost to the adviser. They know the adviser is relatively small, operatesroughly  at break-even, and has a dedicated staff working at considerably less than  standard industry compensation levels. The trustees agreed that given thesmall  size of the Funds, the fall-out benefits (such as discount brokeragecommissions  earned by Saturna Brokerage Services) were not significant.

 
*32* *November 30, 2004        Annual Report*** *Trustees andOfficers (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 (66)      22 Shorewood Drive      Bellingham, WA 98225Independent Trustee        since 1997President (now retired), Ershigs,Inc.        (industrial fabrication)FiveNoneGary A. Goldfogel (46)      1500 N. State Street      Bellingham, WA 98226Independent Trustee        since 1995Medical Examiner (pathologist)        Owner, Avocet Environmental Testing (laboratory)FiveNoneJohn E. Love (72)      1002 Spokane Street      Garfield, WA 99130Chairman;Independent Trustee        since 1987Owner, J.E. Love Co., (agricultural equipmentmanufacturer)FiveNoneJohn S. Moore (73)      346 Bayside Road      Bellingham, WA 98225Independent Trustee        since 1993Professor (now retired), College of Business andEconomics, Western Washington UniversityFiveNone**INTERESTED TRUSTEES**Nicholas F. Kaiser, CFA (58)      1300 N. State Street      Bellingham, WA 98225President;        Trustee*        since 1989President, Saturna CapitalCorporation        President, Saturna Brokerage ServicesSevenAmana Mutual Funds Trust**OFFICERS WHO ARE NOT TRUSTEES**Phelps S. McIlvaine (51)      1300 N. State Streeet      Bellingham, WA 98225Vice President        since 1994Vice President, Saturna CapitalCorporation        Treasurer, Saturna Brokerage ServicesN/AN/AChrisopher R. Fankhauser (32)      1300 N. State Street      Bellingham, WA 98225Treasurer*        since 2002Manager of Operations, Saturna Capital CorporationN/AN/AEthel B. Bartolome (32)    1300 N. State Street    Bellingham, WA 98225Secretary*      since 2001Corporate Administrator, Saturna Capital Corporation [since 2000]     Administrator, Cytel Corporation [1994-1999]N/AN/AJames D. Winship (56)      5406 Diamond Place NE      Bainbridge Island, WA 98110Chief Compliance Officer*        since 2004Corporate Administrator, Saturna Capital Corporation[since 2000]       Administrator, Cytel Corporation [1994-1999]N/AN/A
Term of Office: Each Trustee serves for          the lifetime 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 annual reappointment by the Trustees.         The Trust’s Statement of Additional Information, available without        charge by calling Saturna Capital at 800-SATURNA, includes additional        information about the Trustees.        On November 30, 2004, the trustees, officers and their immediatefamilies        as a group owned 18%, 26.7%, 15.2% and 29% of the outstanding shares        of Bond Income, Short-Term Bond, Growth and International Funds,respectively.        Saturna Capital Corporation is the Trust’s adviser and Saturna        Brokerage Services, Inc. is the Trust’s distributor.         Mr. Kaiser is an interested person of the Trust by reason of hispositions        with the Trust’s adviser and distributor, and the primary manager        of the Sextant Growth Fund and Sextant International Fund.         Mr. McIlvaine is the primary manager of the Sextant Bond Income Fund        and Sextant Short-term Bond Fund.         †        Holds same position with Amana Mutual Funds Trust.
*November 30, 2004Annual      Report* *33*
**Availability of Sextant Portfolio Information(unaudited)**

(1) The Sextant Funds file complete schedules of portfolio    holdings with the SEC for the first and third quarters of each fiscal year    on Form N-Q.    (2) The Funds’ Forms N-Q are available on the SEC’s website at    http://www.sec.gov., and at www.saturna.com.    (3) The Funds’ Forms N-Q may be reviewed and copied at the SEC’s    Public Reference Room in Washington, DC. Information on the operation of    the Public Reference Room may be obtained by calling 1-800-SEC-0330.    (4) The Funds make a complete schedule of portfolio holdings after the end    of each month available to investors at http://www.saturna.com.
**Availability of Proxy Voting Information (unaudited)**
(1) A description of the policies and procedures that theFunds    use to determine how to vote proxies relating to portfolio securities is    available (a) without charge, upon request, by calling Saturna Capital at    1-800 728-8762 (b) on the Funds’ website at http://www.saturna.com;    and (c) on the SEC’s website at http://www.sec.gov.    (2) Information regarding how each Fund voted proxies relating to portfolio    securities during the most recent 12-month period ended June 30 is available    (a) without charge, upon request, by calling Saturna Capital at 1-800728-8752;    (b) on the Funds’ website at http://www.saturna.com; and (c) on the    SEC’s website at http://www.sec.gov.

**Privacy Statement (unaudited)**    At Saturna Capital, we understand the importance to you in maintaining  the    privacy of your financial information. To that end, we want to assure you    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 from transactions or trades placed    with us. Please be assured that except to administer 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 tominimize    the use of outside service providers.    Additionally, Saturna Capital restricts access to personal information about    you to those employees who need to know that information to provide products    or services to you. We maintain physical, electronic, and proceduralsafeguards    that comply with regulations to guard your personal information. If you have    further questions or concerns about the security or privacy of theinformation    we receive from you, please call us at 800 / SATURNA.
*34* *November              30, 2004 Annual Report***
**MORNINGSTAR**

***Source: Morningstar 11/30/04.** Pastperformance does not guarantee future results. For each fund with at least athree-year history, Morningstar calculates a Morningstar Rating™ based ona Morningstar Risk-Adjusted Return measure that accounts for variation in afund’s monthly performance (including the effects of sales charges, loads,and redemption fees), placing more emphasis on downward variations and rewardingconsistent performance. The top 10% in each category receive 5 stars, the next22.5% 4 stars, the next 35% 3 stars, the next 22.5% 2 stars and the bottom 10%receive 1 star. The Overall Morningstar Rating for a fund is derived from aweighted average of performance figures associated with its 3-, 5- and 10-year(if applicable) Morningstar Rating metrics.     Sextant International was 116th of 391 Foreign Large Blend funds in the last3 years and 11th of 284 funds in the last 5 years. With respect to these ForeignLarge Blend funds, Sextant International received a Morningstar Rating of 3 and4 stars for the 3- and 5- year periods, ended 11/30/04 respectively.     Sextant Growth was 137th of 637 Mid-Cap Growth funds in the last 3 years,99th of 424 funds in the last 5 years, and 44th of 159 funds in the last 10years. With respect to these Mid-Cap Growth funds, Sextant Growth received aMorningstar Rating of 4, 4, and 4 stars for the 3-,5-, and 10- year periods,ended 11/30/04 respectively.     Sextant Short-Term Bond was 43rd of 217 Short-Term Bond funds over the last3 years and 52nd of 174 funds in the last 5 years. With respect to theseShort-Term Bond funds, Sextant Short-Term received a Morningstar Rating of 4 and4 stars for the 3- and 5- year periods, ended 11/30/04 respectively.    Sextant Bond Income was 26th of 55 Long-Term Bond funds in the last 3 years,23rd of 39 funds in the last 5 years, and 12th of 18 funds in the last 10 years.With respect to these Long-Term Bond funds, Sextant Bond Income received aMorningstar Rating of 3, 2 and 2 stars for the 3, 5 and 10 year periods, ended11/30/04 respectively.
*November 30, 2004Annual Report* *35*
   

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

 

 

(logo)

SATURNA                        CAPITAL*Mutual Funds*                      1300 N. State Street                    Bellingham WA 98225-4370 

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

This                      report is issued for the information of the shareoweners                      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. Idaho                      Tax-Exempt Fund is a series of Saturna InvestmentTrust.

  

(graphic omitted)
 SEXTANTMutual Funds 
 

 

**SHORT-TERM                              BOND**

**BONDINCOME**

**GROWTH**

**INTERNATIONAL******

 

 

**ANNUAL                              REPORT****November 30, 2004**

SaturnaBrokerage                            Services, Distributor . 

*36* *November                          30, 2004 Annual Report*
**Idaho Tax-ExemptFund**
**November 30, 2004Report**
Fellow Shareowners:          
For the fiscal year ending November 30, 2004, IdahoTax-Exempt Fund provided a total return of +2.29%. The net asset value was $5.39per share compared to $5.46 one year ago and $5.29 in our May semi-annualreport. Total Fund assets grew 10%, to a record $8.47 million.          
In 2004, two major forces clashed in the bond market.            At the short end, the Federal Reserve decided to“"normalize"            short-term rates and pushed up the Fed Funds rate from 1.00% to2.25%.            This            reduces a financial stimulus no longer needed by an increasingly            healthy economy. At the long end, domestic productivity gains and            globalization overwhelmed the impact of the weak US dollar andrising            prices for commodities and energy. US inflation remains so wellcontained            that long-term tax-exempt bond rates actually fell slightly for the            year. The yield curve flattened and long maturities outperformed            shorter maturities.

One year ago, we correctly forecast rising short-terminterest rates. But we underestimated the deflationary pressures from increasedtrade between China, Japan and the US. While inflation has increased recently,it remains well-contained. The remarkable stability of long-term rates in theface of such a weak US currency and strong energy prices is unusual. 

Looking ahead, we remain concerned about the prospectsfor higher inflation. Management intends to limit the weighted average maturityof the Fund to reduce downside price risk. Conservative investors choose theIdaho Tax-Exempt Fund for high-quality tax-free municipal bonds and low pricevolatility. For 2005, capital preservation will continue as a major Fundobjective, and investors may wish to reallocate assets from riskier sectors suchas common stocks. We do expect another year of positive real returns in2005.

The State of Idaho continues to do well financially.            Adjusted for inflation, Idaho's gross state product 5.8% annualgrowth            rate between 1998 and 2002 (the latest year for whichinflation-adjusted          data are available) ranked it **Number 1** (more than          twice the 2.7% U.S. average). Firms in the important electronics,agriculture          and construction industries are prosperous. According to Moody's          Investors Service, which just upgraded its credit, “Idahoincreased          its tax supported debt per capita to $115 in 2003 from $83 in 2002,          yet still ranks 49th (out of 50 states).” The State budgetremains          in balance, and fiscal discipline and pro-business policies give the          State a sharp competitive 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            daily supervision by professional managers. We welcome yoursuggestions.            Only with your help can we be certain that we are meeting yourinvestment            needs —- our primary objective.

***NicholasKaiser,******Phelps                  McIlvaine,***President 
Vice President, PortfolioManager                  
January 4, 2005          
*November 30,                2004 Annual Report* *29***INVESTMENTS**  ***Rating*******Issuer******Coupon/Maturity******FaceAmount******MarketValue******Percentage***   *As of November 30,2004********Electric Power*** AAAIdaho Falls Electric Revenue 6.75% due 4/1/2019$155,000 $159,5481.9%      *******Financial Services*** AAABoise City General Fund Revenue5.20% due 12/1/2017160,000174,8822.1%AAA"5.25% due 12/1/2018100,000109,0351.3% SUB-TOTAL 260,000283,9173.4%      *******General Obligations*** AA-Ada & Canyon Counties JSD #25.50% due 7/30/2011175,000 198,2182.3%AA-"5.50% due 7/30/2015100,000 114,3471.3%AAAAdams County5.00% due 8/1/2014110,000 113,9961.3%A+Bannock County Jail5.05% due 9/1/201295,000 99,4691.2%AAABannock County SD #25 Pocatello5.20% due 8/1/2014100,000106,8741.3%A"5.25% due 8/1/2016110,000 117,4831.4%A"4.90% due 8/1/200990,00095,4651.1%AAABingham County SCD #55 Blackfoot4.65% due 8/1/2017285,000300,5653.5%AA-Boise City ISD UTGO 19965.50% due 7/30/2016150,000155,9941.8%AABoise City ISD Rev. Ada & Boise5.00 due 8/15/2014100,000110,4691.3%ABoise County SD #73 Horshoe Bend5.15% due 7/31/2010125,000 131,6201.6%AAABoundary County SCD #1014.05% due 8/1/2015200,000204,5862.4%AAA"5.10% due 8/1/2022130,000139,4911.6%AAACaldwell5.30% due 5/15/2014150,000 166,0472.0%AAACanyon County SCD #139 Valley View4.05% due 8/15/201680,00080,0400.9%AAACanyon County SD #131 Nampa4.75% due 8/15/2019325,000339,4794.0%AAACanyon County SD #134 Middleton4.65% due 7/31/2016170,000180,8062.1%ACanyon County SD #1356.00% due 8/1/200750,000 49,8210.6%AAACassia & Twin Falls JSD #1515.375% due 8/1/201385,000 89,0631.1%AAA"5.375% due 8/1/201575,000 78,5850.9%AAAClark County SD #161 Dubois5.00 % due 8/1/2015270,000291,7013.4%AAIdaho Housing and Finance Association4.80% due 6/1/2017100,000106,2861.3%AAAKootenai County SD #2735.00% due 7/30/201670,000 73,1770.9%AAAKuna Sch/Comm Library District4.90% due 8/1/201375,000 80,4480.9%AAALemhi County4.20% due 8/1/2015100,000102,9071.2%AAAMeridian Free Library District5.00% due 8/1/2015200,000208,3462.5%AAAOneida County SCD #351 Malad City4.00% due 8/15/2015150,000151,8121.8%AAAOwyhee & Canyon Cos. JSD #3704.55% due 8/15/2016160,000169,2632.0%AAAPower & Cassia Cos. JSD #3815.25% due 8/1/201260,000 65,6440.8%AAATeton County SD #401 5.50% due 8/1/201275,000 78,7370.9% SUB-TOTAL 3,965,0004,200,73949.4%      *******Housing***  AAIdaho Housing Agency6.85% due 7/1/201220,00020,0290.2%AA"6.15% due 7/1/202455,00055,0600.6%AA+"6.60% due 7/1/201115,00014,9930.2%AAAValley County Jail Project Ref.4.70% due 8/1/2014125,000129,7911.5% SUB-TOTAL 215,000219,8732.5%*30******November                  30, 2004 Annual Report****Rating*******Issuer******Coupon/Maturity******FaceAmount******MarketValue******Percentage**********Medical/Hospitals*** AAAIdaho Health Facility Holy Cross Rev Ref5.25% due 12/1/2011$65,000$69,7830.8%AAAIdaho Health Facility Auth Rev Ref5.25% due 12/1/2014110,000118,0201.4%AAAIdaho Health Facility Auth. Corp5.00% due 12/1/2022115,000118,5591.4%AAAMadison Hospital COP5.00% due 12/1/2018105,000112,4181.3% SUB-TOTAL 395,000418,7804.9%      *****Pollution Control*** AAAIdaho Bond Bank Authority Rev4.30% due 9/1/2022135,000132,2001.6%      *****Real Estate*** AAABoise City Urban Renewal Agency Pk Rev &RA5.00% due 9/1/201265,00070,3920.8%AAAIdaho State Building Association5.05% due 9/1/201895,000101,2561.2%AAAIdaho State Building Authority 5.00% due 9/1/2021100,000 105,1431.2%AJerome Urban Renewal District5.40% due 9/1/2013200,000206,8822.5% SUB-TOTAL 460,000483,6735.7%      *******Roads*** APayette L.I.D. #89-17.60% due 5/1/200530,000 29,8510.4%APost FallsL.I.D. #91-47.95% due 4/15/200520,000 19,8980.3%A"7.95% due 4/15/200620,000 19,8910.3%A"7.95% due 4/15/200720,000 19,8910.3% SUB-TOTAL 90,00089,5311.3%       ***State Education***    AAABoise State University Revs-Ref.5.10% due 4/1/2014300,000 324,2733.8%AAAIdaho State University Building Authority4.00% due 9/1/2016105,000104,7571.2%AAAIdaho State University Ref & I mpt4.90% due 4/1/2017150,000159,7261.9%AAAIdaho State University Rev4.625% due 4/1/2024220,000223,8192.6%AAAUniversity of Idaho5.60% due 4/1/2015185,000198,2952.3%AAAUniversity of Idaho Student Fee Rev5.25% due 4/1/2014120,000131,0541.6% SUB-TOTAL 1,080,0001,141,92413.4%      *******Sewer*** ATroy Sewer Revenue7.70% due 2/1/200515,000 14,9180.2%A"7.80% due 2/1/200615,000 14,9260.2%A"7.90% due 2/1/200715,000 14,9340.2%A"8.00% due 2/1/200815,000 14,9380.2%A"8.00% due 2/1/200920,000 19,9190.2%A"8.00% due 2/1/201020,000 19,9260.2% SUB-TOTAL 100,000 99,5611.2%       ***Urban Renewal***    AAABoise City Urban Ren Agcy Lease Rev5.875% due 8/15/2025190,000 210,5312.5%AAPocatello Dev Auth Rev Al Tax Inc5.15% due 3/1/2011150,000 159,2221.8% SUB-TOTAL 340,000 362,7534.3%      *November                  30, 2004 Annual Report* *31****Rating*******Issuer******Coupon/Maturity******FaceAmount******MarketValue******Percentage*** ***Water Supply***    AAABlackfoot COP Series 20005.80% due 9/1/2018$135,000$153,9791.8%AAAKetchum Water Revenue4.75% due 9/1/201360,00063,4160.8%AAAMcCall Water System6.25% due 9/1/2008200,000 212,6062.5%AAAMcCall Water System6.375% due 9/1/201470,00073,5900.9%AAAMoscow Sewer Revenue4.125% due 11/1/2008165,000172,6622.0% SUB-TOTAL 630,000676,2538.0%    **Total Investments****(Cost = $7,975,044)****$7,825,000****$8,268,752****97.6%** **Other Assets (net of liabilities)** **203,672****2.4%** **Total Net Assets** **$8,472,424****100.0%**** These unaudited bond ratings reflect theadviser's                current rating of each bond, as determined using Standard &Poor's                and Moody's ratings.***FINANCIAL                  HIGHLIGHTS***Selected data per share of capital stockoutstanding                throughout the year:* **For Year Ended November                  30,**  **2004****2003****2002****2001****2000****Net asset value at beginning of year** **$5.46****$5.37****$5.28****$5.13****$5.01***Income from investment operations*      Net investment income 0.190.210.220.220.23 Net gains or losses on securities (both realized                and unrealized) (0.07)0.090.090.150.12 Total from investment operations 0.120.300.310.370.35 *Less distributions*      Dividends (from net investment income) (0.19)(0.21)(0.22)(0.22)(0.23)Total distributions (0.19)(0.21)(0.22)(0.22)(0.23)       **Net asset value at end of year** **$5.39****$5.46****$5.37****$5.28****$5.13**  **********************Total Return** **2.29%****5.40%****5.98%****7.40%****7.28%**       Ratios / Supplemental Data      Net assets ($000), end of year $8,472$7,692$6,943$6,650$5,628 **Ratio of gross expenses to average netassets**      Before custodian fee waiver 0.95%0.88%0.88%0.90%0.94%After custodian fee waiver 0.93%0.85%0.80%0.79%0.80%Ratio of net investment income to average netassets 3.56%3.78%4.14%4.21%4.69%       **Portfolio turnover rate********15%****6%****11%****13%****14%***(The accompanying notes are anintegral part of these financial statements)**32******November 30, 2004 Annual Report***STATEMENT                    OF ASSETS AND LIABILITIES***As of November 30, 2004*   **Assets**Bond investments (cost $7,975,044)$8,268,752Cash388,588Interest receivable114,620Insurance Reserve Premium800Total Assets$8,772,760   **Liabilities**Payable for securities purchased287,326Other Liabilities11,853Due to affiliates1,157Total Liabilities300,336 **Net Assets**$8,472,424 **Fund Shares Outstanding**1,571,241 **Analysis of Net Assets**Paid in Capital (unlimited shares authorized,without                par value)8,213,185Accumulated net realized loss (34,469)Unrealized net appreciation to on investments293,708Net Assets applicable to Fund sharesoutstanding$8,472,424**Net Asset Value, Offering and Redemption price                per share****$5.39**
*(The accompanying notes are an integral part of            these financial statements)*
*November                30, 2004 Annual Report* *33***STATEMENT                  OF OPERATIONS**  *For the year ended November                  30, 2004***Investment income**   Interest income $373,295Amortization of bond premium (20,303)Accretion 1,277 Gross investment income$354,269  **Expenses** Investment adviser and administration fees 39,632Audit fees 9,446Legal fees 6,285Insurance 5,732Shareholder service fee 4,141Custodian fees 4,134Printing and postage 2,158Trustees fees 1,784Filing and registration fees 1,021Other expenses 554Total gross expenses 74,887Less custodian fees waived (1,647)Net expenses 73,240 Net investment income281,029**Net realized loss on investments** Proceeds from sales 1,106,449Less: cost of securities sold (based on identified                cost) 1,119,919 Realized net loss(13,470)**Unrealized gain on investments** End of year 293,708Beginning of year 370,360Decrease in unrealized gain for the year (76,652) Net realized and unrealized loss(90,122)**Net increase in net assets resulting fromoperations** **$190,907**
*(The accompanying notes are an            integral part of these financial statements)*
*34******November                  30, 2004 Annual Report***STATEMENT                  OF CHANGES IN NET ASSETS** Year endedYear ended Nov. 30, 2004Nov. 30, 2003**INCREASE IN NET ASSETS**  ***From Operations***  Net investment income$281,029$276,090Net realized gain (loss) on investments(13,470)10,663Net increase (decrease) in unrealized appreciation (76,652) 94,455Net increase in net assets  190,907 381,208 ***Dividends to shareowners from***Net investment income(281,029)(276,090) ***From fund share transactions***Proceeds from sales of shares1,610,9761,140,412Value of shares issued in reinvestment of dividends223,255216,574 1,834,1151,356,986Cost of shares redeemed(963,286)(713,555)Net increase in net assets870,945643,431**Total increase in net assets****$780,707****$748,549** **NET ASSETS**Beginning of year7,691,7176,943,168End of year$8,472,424$7,691,717 **Shares of the fund sold and redeemed**Number of shares sold298,944209,181Number of shares issued in reinvestment of dividends41,31139,726 340,255248,907Number of shares redeemed(178,689)(131,040)**Net increase in number of shares outstanding****161,566****117,867**
*(The accompanying notes are anintegral part of these financial statements)*

 
*November                  30, 2004 Annual Report* *35*
**Discussion of Fund            Performance****(unaudited)**

**FISCAL YEAR2004**                  For the year ending November 30, 2004, Idaho Tax Exempt Fund                    returned 2.29%. At November 30, 2004, the Fund heldMorningstar's† overall “4-star” rating                    (judged against 227 funds in the Muni Single StateIntermediate-term                    category, overall). At fiscal year end, the thirty-day SEC                    current yield was 2.93%, down from 3.20% one year ago. The                    Fund's net assets grew 10% during the year, as they                    also did the year before. Consistent with the Fund's                    conservative investment philosophy, the Fund's price                    ranged between $5.25 and $5.46 per share (a 4.0% variation                    from low to high). .*Average Annual Total                    Returns*1 year5 years10 years**2.44%****5.89%****5.81%**Performance data forcalendar                      years ended 12/31/2004. Performance data quoted represents                      past performance                      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 originalcost.
**FACTORS AFFECTING PASTPERFORMANCE**              In 2004, rising prices of commodities and energy, the record trade              and budget deficits and a weak US dollar all predicted asignificant              rise in US inflation. Typically domestic bond investors respond              to such forces by demanding higher interest rates to compensate              for the loss of purchasing power. 
Ratings         established By         AdvisorBy Standard &Poor'sBy Moody's         Investor ServicesAAA71.8%38.4%60.9%AA9.5%8.9%4.6%A16.4%4.0%3.7%unrated--46.5%28.6%cash2.2%2.2%2.2%
For the year, short–term AAA general obligation yields                did rise 0.50% to 0.90%, but ten-year AAA general obligation                yields were unchanged. This means short-term securitiesunderperformed                long-term securities and the Fund’s conservative short                average maturity hindered its total return. The average maturity                of the Fund is the most important factor affecting principal                values in the portfolio. The Fund average maturity is now 5.59                years, up from 5.33 years last November. Under normalconditions,                the Fund’s average maturity is in the six to fifteen year                range. The shorter maturity results from management’scautious                outlook.                 Idaho’s high state income taxes create a substantialappetite                among residents for tax-exempt bonds. The imbalance between the                demand for and the supply of issues is an important element in                the performance of Idaho paper in both bull and bear markets.                High-grade municipal bonds generally outperform US Treasurys                in periods of rising rates and underperform in periods offalling                rates. We expect this low relative volatility to continue.

***Source: Morningstar 11/30/04**.          *Past                performance does not guarantee future results. For each fund                with at least a three-year history, Morningstar calculates a                Morningstar Rating™ based on a Morningstar Risk-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. The Overall Morningstar Rating for a fund is derived                from a weighted average of performance figures associated with                its 3-, 5- and 10-year (if applicable) Morningstar Ratingmetrics.                The following are percentile rankings where 1 is best and 100                is worst. Idaho Tax-Exempt ranked 48 of 227 Muni Single State                Intermediate-term funds over the last 3 years, 44 against 201                funds over the last 5 years, and 60 against 122 funds in the                last 10 years. With respect to these numbers of MuniSingle-State                Intermediate-term funds, Idaho Tax-Exempt received a Morningstar                rating of 4, 4, and 3 stars for the 3-, 5-, and 10- yearperiods,                ended 11/30/04 respectively.*
*(The accompanying notes are anintegral part of these financial statements)*
*36******November                  30, 2004 Annual Report*
**Discussion of FundPerformance                (continued) [unaudited]**

**LOOKINGFORWARD**            In 2004, we expect the US economy to grow 2%-4% and corporateprofits to increase 7%-14%. The Federal Reserve Bank will push short-term ratesup toward 3.5%. We expect ten-year AAA Idaho municipal yields to rise from 3.6%% to 4.5%. But if the US looses debt funding from abroad, rates in the US couldrise sharply. The Fund could have an opportunity to buy higher yielding bondsand extend its maturity. 

Strong competition between municipal bond insurers andthe Idaho School Bond Guarantee Program will reduce availability of new issuenon-rated paper. The yield advantage of quality uninsured paper can beattractive, but the supply has dwindled to a trickle. 6.9% of the portfolioremains invested in non-rated paper, down from 7.9%, the result of severalissuers maturing. Credit quality of other non-rated issuers owned by the Fundremains secure.

**COMPARISON TOINDEX**            The graph below compares the  Fund's performance to the performance              of the Lehman Brothers Composite Municipal Bond Index, abroad-based              municipal bond market index. Though the Fund does not try to“"beat"” any              index, the Fund's returns, considering the lower pricefluctuation,              compare well to that of the Lehman Index for the fiscal year. Note              that this graph compares an unmanaged, expense free index to an              actively managed fund that has transaction and other operational              costs. The Fund also stands ready to buy and sell its ownsecurities              to shareowners on a daily basis, as well as providing a wide range              of services to them.          
The graph shows that $10,000 invested in the Idaho TaxExempt Fund on 11/30/94 would have grown to $17,785 at the end of November 2004.If $10,000 could have been invested in the Lehman Brothers Composite MunicipalBond Index on 11/30/94, it would have grown to $19,969.

**Idaho Tax Exempt Bond Fund vs. Lehman Composite                          Municipal Bond Index (unaudited)**
Fund Average Annual Returns            One Year 2.29%            Five Year 5.70%Ten Year 5.79%          
*(graphic omitted*)          
*November                  30, 2004 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 InvestmentCompany                  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 separate                  report.                  The investment objective of the Fund is to provide income free                  from federal income, federal alternative minimum and Idaho                  state income taxes, with a secondary objective of capitalpreservation.
**Note 2 - Significant AccountingPolicies****The following is a summary of the significantaccounting policies followed by the Fund.                  
***Security valuation:***                    Fixed-income securities for which there are no publiclyavailable                      market quotations are valued using matrices based onmaturity,                      quality, yield, call features and similar factors, which                      are compared periodically to multiple dealer bids andadjusted                      by the adviser under fair value policies established by                      the Trustees. The ability of issuers of debt securities                      held by the Fund to meet their obligations may be affected                      by economic and political developments in the State of                  Idaho.
***Income taxes:***                    The Fund’s policy is to continue to comply with the                    requirements of the Internal Revenue Code that areapplicable                    to regulated investment companies and to distribute all its                    taxable income to its shareowners. Therefore, no provision                    for Federal income taxes is required. Further, the Fundintends                    to meet requirements for tax-free income dividends, andrequirements                    of the Idaho Department of Revenue for income dividends free                    of Idaho state income tax.***Dividends and distributions toshareowners:***                    Dividends and distributions to shareowners, which aredetermined                    in accordance with income tax regulations, are recorded on                    the ex-dividend date. Dividends are paid daily anddistributed                    on the last business day of each month. Shareowners electing                    to reinvest dividends and   Interest income is increased by accretion only for bonds underwritten asoriginal issue discounts. Discounts and premiums on securities purchased areamortized, over the lives of the respective securities.  Expenses incurred by the Trust on behalf of the Fund (e.g., professional fees)are allocated to the Fund and the other Funds of the Trust on the basis ofrelative daily average net assets. The Adviser has agreed to certain limits onexpenses, as described below.                
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 United States                  of America requires management to make estimates andassumptions                  that affect the reported amounts of assets and liabilities                  and disclosure of contingent assets and liabilities at the                  date of the financial statements and the reported amounts of                  increases and decreases in net assets from operations during                  the reporting period. Actual results could differ from those                  estimates. ***Other:***                  The cost of securities is the same for accounting and Federal                  income tax purposes. Securities transactions are recorded on                  trade date.                  Interest income is recognized on an accrual basis. Discounts                  and premiums on securities purchased are amortized, over the                  lives of the respective securities.                   Expenses incurred by the Trust on behalf of the Fund (e.g.,                  professional fees) are allocated to the Fund and the other                  Funds of the Trust on the basis of relative daily average net                  assets.
**Note 3 - Transactions withAffiliated Persons****Under a contract approved by shareowners on October                    12, 1990, Saturna Capital Corporation provides investment                    advisory services and certain other administrative anddistribution                    services to conduct the Fund’s business. For suchservices,                    the Fund pays an annual fee equal to .50% of average daily                    net assets. For the year ended November 30, 2004, the Fund                    incurred advisory fee expenses of $39,632.                     In accordance with the Fund’s agreement with itscustodian,                    National City Bank of Indiana, for the year ended November                    30, 2004, custodian fees incurred by the Fund amounted to                    $4,134. The custodian waived $1,647 of its fees for earnings                    credits.                    Saturna Brokerage Services, Inc. (a subsidiary of Saturna                    Capital Corporation) is a broker-dealer and acts asdistributor                    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, 2004,                  the Fund paid shareholder servicing                
                 
*38******November 30, 2004 Annual Report*
fees of $4,141.                  One trustee, who also serves as the president of the Trust,                      is a director and president of the Adviser. On November                      30, 2004, the trustees, officers and their immediatefamilies                      as a group owned 0.05% of the outstanding shares of the                      Fund.                  The four unaffiliated trustees receive $200 per Board orcommittee                  meeting attended, plus travel expenses, allocated pro-rata                  to the five Funds of Saturna Investment Trust. The Trust paid                  the Independent Trustees $2,400 to attend meetings during the                  fiscal year. New regulations in 2004 required the Trust to                  designate a Chief Compliance Officer; Mr. Winship was retained                  by the Trust and paid $6,250 during the fiscal year. The other                  officers are paid by Saturna Capital, and not the Trust.
**Note 4 - Federal IncomeTaxes****At November 30, 2004, Idaho Tax-Exempt had capital                    loss carryforwards of $34,469 of which $20,999 expire in                    2008 and $13,470 expire in 2012, subject to regulation.Prior                    to their expiration, such loss carryforwards may be used                    to offset future net capital gains realized for federalincome                  tax purposes.                
                 
                 
 
                 

**Note 5 -Investments****During the year ended November 30, 2004, the Fundpurchased                  $2,018,602 of securities and sold/matured $1,106,449 ofsecurities.***Distributions toshareowners:***  The tax character of distributions paid during the years ended November 30,  2004 and 2003 were as follows:2004Tax-Exempt Income:  $280,630 Taxable Income: $399                  
2003                    Tax-Exempt Income: $276,090                  Taxable Income: -                  
As of November 30, 2004 the components of capital on a tax                    basis were as follows:  Cost of investments(a): $7,975,044  Gross unrealized appreciation: 314,233  Gross unrealized depreciation: (20,525)  Net unrealized appreciation: $293,708Undistributed ordinary income: -  Capital  loss carryforward: (34,469)Total distributable earnings: $(34,469)                  
Total accumlated earnings/losses: $259,239                  
(a) At November 30, 2004, the basis ofinvestments for federal                    income tax purposes does not differ from the cost offinancial                  reporting purposes.
                   

**Privacy                          Statement (unaudited)**

At Saturna Capital, we understand the importance to                        you in maintaining the privacy of your financialinformation.                        To that end, we want to assure you 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 from transactions or trades        placed with us. Please be assured that except to administer atransaction        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 owntechnology        resources to minimize the use of outside service providers.        Additionally, Saturna Capital restricts access to personal information        about you to those employees who need to know that information toprovide        products or services to you. We maintain physical, electronic, andprocedural        safeguards that comply with regulations to guard your personalinformation.        If you have further questions or concerns about the security or privacy        of the information we receive from you, please call us at 800 /SATURNA.**

 

*November 30, 2004 Annual Report* *39***EXPENSES                        (unaudited)**
As an Idaho Tax-Exempt mutual fund shareowner, youincur ongoing costs, including management fees and other fund expenses. Unlikemany mutual funds, you do not incur sales charges (loads) on purchase payments,reinvested dividends, or other distributions. Nor do you incur redemption fees,exchange fees, or fees related to Individual Retirement Accounts. You may incurfees related to extra services requested by you for your account, such as acheckbook to use for redemptions or bank wires.**EXAMPLE**  The exampleis based on an investment of $1,000 invested at the beginning ofthe fiscal year and held for the entire year [Friday, November 28, 2003 toTuesday, November 30, 2004].**ACTUAL EXPENSES**  The first line provides information about actual account values and actualexpenses. You may use the information in this line, together with the amount youhave invested, to estimate the expenses that you paid over the period. Simplydivide your account value by $1,000 (for example, a $9,400 account value dividedby $1,000 = 9.4), then multiply the result by the number in the first line underheading entitled “Expenses Paid During Year” to estimate theexpenses you paid on your account during this fiscal year. The Fund also chargesthe following fees for extra services rendered on request, which you may need toadd to determine your total expenses: $10 per checkbook, $25 per bank wire, $15per overnight courier delivery.**HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES**  The second line provides information about hypothetical account values andhypothetical expenses based on the Fund’s actual expense ratio (based onthe last six months) and an assumed rate of return of 5% per year beforeexpenses, which is not the Fund’s actual return. The hypothetical accountvalues and expenses may not be used to estimate the actual ending accountbalance or expenses you paid for the year. You may use this information tocompare the ongoing costs of investing in the Fund and other funds. To do so,compare this 5% hypothetical example with the 5% hypothetical examples thatappear in the shareowner reports of the other funds. You may wish to add otherfees that are not included in the expenses shown in the table, such as IRA fees(there are no IRA fees with the Idaho Tax-Exempt Fund), and charges for extraservices such as check writing and bank wires.  Please note that the expenses shown are meant to highlight your ongoing costsonly and do not reflect any transactional costs, such as sales charges (loads),redemption fees, or exchange fees (note that the Idaho Tax-Exempt Fund do nothave any such transactional costs). Therefore, the second line is useful incomparing ongoing costs only, and may not help you determine the relative totalcosts of owning different funds. 
**IDAHO TAX-EXEMPT FUND**Beginning Account Value[Friday, November 28, 2003]Ending Account Value[Tuesday, November 30, 2004]Expenses Paid DuringPeriod*Actual          (2.29% return           after expenses)$1,000$1,022.90$9.31Hypothetical          (5% return           before expenses)$1,000$1,040.80$9.39
* Expenses are equal to IdahoTax-Exempt Fund’s annualized expense ratio of 0.92% (based on the mostrecent semi-annual period of June 1, 2004 through November 30, 2004), multipliedby the average account value of $1,011.45 over the period.

*40******November 30, 2004 Annual Report*
**REPORT of            REGISTERED            INDEPENDENT  PUBLIC ACCOUNTING FIRM**

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 Saturna Investment Trust,  including the schedules of investments as of November 30, 2004, and therelated  statements of operations for the year then ended, the changes in net assets  for each of the two years in the period then ended, and the financialhighlights  for the five years in the period 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 the standards of the Public Company  Accounting Oversight Board (United States). 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 materialmisstatement.  An audit includes examining, on a test basis, evidence supporting the amounts  and disclosures in the financial statements. Our procedures includedconfirmation  of securities owned as of November 30, 2004, by correspondence with thecustodian  and broker. Our audit also includes assessing the accounting principles used  and significant estimates made by management, as well as evaluating theoverall  financial statement presentation. We believe that our audits provide areasonable  basis for our opinion.   In our opinion the financial statements and financial highlights referred to  above present fairly, in all material respects, the financial position ofIdaho  Tax-Exempt Fund as of November 30, 2004, the results of its operations for  the year then ended, the changes in net assets for each of the two years in  the period then ended, and the 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/ signature*Tait, Weller & Baker*
  Philadelphia, Pennsylvania   December 17, 2004          
           
*November 30, 2004 Annual Report* *41* *Trusteesand 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 (66)      22 Shorewood Drive      Bellingham, WA 98225Independent Trustee        since 1997President (now retired),Ershigs, Inc.        (industrial fabrication)FiveNoneGary A. Goldfogel (46)      1500 N. State Street      Bellingham, WA 98226Independent Trustee        since 1995Medical Examiner(pathologist)        Owner, Avocet Environmental Testing (laboratory)FiveNoneJohn E. Love (72)      1002 Spokane Street      Garfield, WA 99130Chairman;                Independent Trustee        since 1987Owner, J.E. Love Co., (agricultural equipmentmanufacturer)FiveNoneJohn S. Moore (73)      346 Bayside Road      Bellingham, WA 98225Independent Trustee        since 1993Professor (now retired), College of Business andEconomics, Western Washington UniversityFiveNone**INTERESTED TRUSTEES**Nicholas F. Kaiser, CFA (58)      1300 N. State Street      Bellingham, WA 98225President;                Trustee*        since 1989President, Saturna CapitalCorporation        President, Saturna Brokerage ServicesSevenAmana Mutual FundsTrust**OFFICERS WHO ARE NOTTRUSTEES**Phelps S. McIlvaine (51)      1300 N. State Streeet      Bellingham, WA 98225Vice President        since 1994Vice President, Saturna CapitalCorporation        Treasurer, Saturna Brokerage ServicesN/AN/AChrisopher R. Fankhauser (32)      1300 N. State Street      Bellingham, WA 98225Treasurer        since 2002Manager of Operations, Saturna CapitalCorporationN/AN/AEthel B. Bartolome(32)    1300 N. State Street    Bellingham, WA 98225Secretary      since 2001Corporate Administrator, Saturna Capital Corporation [since                2000]     Administrator, Cytel Corporation [1994-1999]N/AN/AJames D. Winship, Esq. (56)    5406 Diamond Place NE    Bainbridge Island, WA 98110Chief Compliance Officer*      since 2004Attorney                Adjunct Professor, University of    Washington and Seattle Pacific University (1999-2003)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.                 The Fund’s Statement of Additional Information, available                without charge by calling Saturna Capital at 800-SATURNA,includes                additional information about the Trustees.                Saturna Capital Corporation is the Fund’s adviser andSaturna                Brokerage Services, Inc. is the Fund’s distributor.                Mr. Kaiser is an interested person of the Fund by reason of his                positions with the Fund’s adviser and distributor.                 Mr. McIlvaine is the primary manager of the Idaho Tax-Exempt                Fund.               *Holds same position with Amana Mutual Funds Trust.*42* *November 30, 2004 Annual Report*
**RENEWAL OF INVESTMENT ADVISORY CONTRACT(unaudited)**            On September 20, 2004, the trustees of Saturna Investment Trustapproved              continuation of Idaho Tax-Exempt Fund’s investment advisory              and administrative services agreement with Saturna CapitalCorporation.              In doing so, the board considered a number of factors and made              specific determinations relevant to that approval.            In addition to information provided throughout the year, thetrustees            utilized a comparison of performance and fees of the Fund with the            other Idaho tax-exempt mutual funds. The trustees found suchinformation            helpful in establishing expectations regarding the performance of            the adviser and whether to continue the advisory contract.            In their review, the trustees noted that the Fund offers a fullrange            of high-quality investor services. An important factor in theconsideration            by the trustees was the adviser’s ability and commitment to            internally perform shareowner servicing, administration, accounting,            marketing and distribution to maintain quality servicing at areasonable            expense.            The trustees found that the investment performance of the Fund was            good. The board took into consideration the investment objectives            and policies of the Fund.            The trustees reviewed the fees and expenses of the Fund. They noted            that the adviser’s fees are customary, fair and reasonable            to shareowners. They considered the fees charged by the adviser to            other kinds of accounts and the different services provided to those            accounts. In addition, the trustees found the expense ratio was less            than that of the other Idaho tax-exempt fund and to be advantageous            to shareowners given the sizes of the funds, services provided and            expenses incurred. They took into consideration the adviser’s            avoidance of operational problems, such as those publicized at other            funds in the last year. They noted that various Fund expenses,outside            the adviser’s control, were rising due to new mutual fundindustry            regulations.            The trustees found that the Fund continues to operate at asubstantial            cost to the adviser. They know the adviser is relatively small,operates            roughly at break-even, and has a dedicated staff working atconsiderably            less than standard industry compensation levels. The trustees did          not find any fall-out benefits from the Fund to the adviser.
**AVAILABILITY OF FUND PORTFOLIO INFORMATION              (unaudited)**
(1) The Fund files a complete schedule of portfolioholdings with the SEC for the first and third quarters of each fiscal year onForm N-Q.            (2) The Fund’s Forms N-Q is available on the SEC’swebsite at http://www.sec.gov., and at www.saturna.com.            (3) The Fund’s Forms N-Q may be reviewed and copied at theSEC’s Public Reference Room in Washington, DC. Information on theoperation of the Public Reference Room may be obtained by calling1-800-SEC-0330.            (4) The Fund makes a complete schedule of portfolio holdings afterthe end of each month available to investors at http://www.saturna.com.
*November 30,2004 Annual Report* *43*
 

 

 

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

 

 

 

 

***(logo)                    SATURNA CAPITAL                    Mutual Funds***

1300 N. State Street                    Bellingham, WA 98225-4730800/SATURNA(800/728-8762)***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, 2004

Saturna Brokerage Services,Distributor
*44* *November 30, 2004 Annual Report*
**Item 2. Code of Ethics.**Registrant has adopted a code of ethics and is included          with this submission as Exhibit (a).**Item 3. 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.

**Item 4. Principal Accountant Feesand Services.***(a) Audit Fees*            For the fiscal years ending November 30, 2004 and 2003, theaggregate               audit fees billed for professional services rendered by theprincipal            accountant were $23,000, for each year.*(b) Audit-Related Fees*            For the fiscal years ending November 30, 2004 and 2003, theaggregate             audit-related fees were $15,500 for each year. The nature            of the services are: (1) auditing of the statements of assets and             liabilities, related statements of operations and changes in net            assets,            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, 2004 and 2003, theaggregate            tax fees billed for professional services rendered by the principal           accountant were $7,500 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, 2004 and 2003.*(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.
*November 30, 2004 Annual Report* *45*
*(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.***Item 5. Audit Committee of Listed Registrants.**The registrant has designated the independent members            of the Saturna Investment Trust board of directors as the auditcommittee.            The members are: Herbert Ershig, Gary Goldfogel, John Love, and John            Moore.**Item 6. Schedule of Investments**            The schedule is included as part of the report to shareholders filedunder Item 1 of this Form.

**Item 7. Disclosure of Proxy VotingPolicies and Procedures for Closed-End Management InvestmentCompanies.***Not applicable.*

**Item 8. Portfolio Managers ofClosed-End                Management Investment Companies.***Not applicable.*

**Item 9. Purchases of EquitySecurities                by Closed-End Management Investment Company and AffiliatedPurchasers.***Not applicable.*

**Item 10. Submission of Matters to                a Vote of Security Holders.***Not applicable.*

**Item 11. Controls andProcedures.**(a) Internal control over financial reporting is under the          supervision of the principal executive and financial officers. OnDecember          29,          2004, Mr. Nicholas Kaiser (President) and Mr. Christopher Fankhauser          (Treasurer), reviewed          the internal control procedures for Saturna Investment TrustFundsTrust          and found them reasonable and adequate.

(b) No change.

**Item 12. 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
*46* *November 30, 2004 Annual Report*
**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, 2005            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, 2005            By:            /s/ Christopher Fankhouser             Christopher Fankhouser, Treasurer          Date: January 28, 2005
*November 30, 2004 Annual Report* *47*
 

 

 

 

 

****