Securities and Exchange Commission  Judiciary Plaza  450 Fifth Street NWWashington DC 20549

March 29, 2006

RE: Saturna Investment Trust	File Nos. 33-13247; 811-05071  Post-Effective Amendment No. 26 on Form N-1A

Ladies and Gentlemen:

On behalf of the referenced Trust, please find enclosed  for filing pursuant to Rule 485(b)  Post-Effective Amendment No. 26 to the Trust’s Registration Statement  on Form N-1A.

This Post-Effective Amendment is the annual update to Saturna  Investment Trust’s  Registration Statement. It includes financial information updated for the fiscal  year ended November 30, 2005. There are no material changes requiring disclosure  update. 

A graphical PDF version of this filing is available at http://www.saturna.com/red/.  

If you have any questions or comments concerning this filing, kindly contact  me at 1-360-594-9900 (x601). 

Thank you for your attention to this matter.

> 
Sincerely,        Saturna Investment Trust

 

Nicholas Kaiser        President

 

cc:	file  James Strain, Esq. 

 File No. 33-13247

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SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549

**FORM N-1A**

**REGISTRATION STATEMENT UNDER   THE SECURITIES ACT OF 1933   POST-EFFECTIVE AMENDMENT NO. 26  and  REGISTRATION STATEMENT UNDER   THE INVESTMENT COMPANY ACT OF 1940   POST-EFFECTIVE AMENDMENT NO. 26**

**SATURNA INVESTMENT TRUST**  (Exact Name of Registrant as Specified in Charter)  1300 North State Street  Bellingham, Washington 98225-4730  (Address of Principal Executive Offices)

Registrant’s Telephone Number  - (360) 594-9900

Nicholas Kaiser, President  1300 North State Street  Bellingham, Washington 98225-4730  (Name and Address of Agent for Service)

 

It      is proposed that this filing will become effective:  [X]	Immediately upon filing pursuant to paragraph (b)  [ ] on _______ pursuant to paragraph (b)   [ ]	60 days after filing pursuant to paragraph (a)(1)  [ ]	on _________ pursuant to paragraph (a)(1)   [ ]	75 days after filing pursuant to paragraph (a)(2)   [ ]	on _______ pursuant to paragraph (a)(2) of rule 485  If appropriate, check the following box:  [ ] this post-effective amendment designates a new effective date for apreviously filed post-effective amendment.

 

EXPLANATORY NOTE

This Post-Effective Amendment is the revised annual update  to Saturna Investment Trust’s Registration Statement. It includes financial  information updated for the fiscal year ended November 30, 2005 and increased  disclosures requiredby regulation. A graphical PDF version of this filing is available at http://www.saturna.com/red/.

II

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| **Item**

**For Sextant Mutual Funds**

**Part A**

1.	(a) Front Cover Page	      (b) Back Cover Page	

2. Risk/Return Summary	

3. Fee Table	

4. (a) Investment Objectives	        (b) Principal Investment Strategies	      (c) Risks	

5. Management’s Discussion of Performance 

6. (a) Management	      (b) Capital Structure	

7. Shareowner        information         (a) Pricing of Fund Shares	        (b) Purchase of Fund Shares	        (c) Redemption of Funds Shares	        (d) Dividends and distributions	      (e) Tax Consequences	

8. Distribution arrangements

9. Financial Highlights Information 

**Part B**

10. Cover Page & Table of Contents	        11. Trust History	

12. Fund Descriptions, Investments and Risks 

13. Management of the Trust          

14. Control Persons and Principal Holders of Securities	        15. Investment Advisory and Other	Services	

16. Brokerage Allocation        and Other	Practices

17. Capital Stock and Other Securities	

18. Purchase, Redemptions and          Pricing	of Securities Being Offered

19.            Taxation of the Trust | **Prospectus**

Cover Page       Application & Back Cover Page    

A Quick Look at Sextant Mutual Funds

Fees and Expenses 

Investment Objectives,    Investment Strategies &    Risks

Not applicable (in Annual Report)

Investment Adviser      Not applicable (no restrictions)    

      Pricing of Fund Shares      How to Buy Shares      How to Redeem Shares      Dividends      Tax Information

Investment Adviser      Fees & Expenses    

Financial Highlights

**Statement of Additional Information**

Cover Page      Table of Contents

History of the Funds

Fund Descriptions, Investments and Risks 

Management of the Funds

Principal Holders of Securities

Investment Advisory and other services

Brokerage Allocation

Capital Stock

Purchase, Redemption and Pricing of Shares

Taxation of the Funds |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

III

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| 20. Underwriters 

21. Calculations of Performance Data

22. Financial Statements

**Item**

**For Idaho Tax-Exempt Fund**

**Part A**

1.	(a) Front Cover Page         (b) Back Cover Page 

2. Risk/Return Summary 

3. Fee Table 

4. (a) Investment Objectives         (b) Principal Investment Strategies         (c) Risks 

5. Management’s Discussion of Performance 

6. (a) Management         (b) Capital Structure	

7. Shareowner information         (a) Pricing of Fund Shares         (b) Purchase of Fund Shares         (c) Redemption of Funds Shares         (d) Dividends and distributions         (e) Tax Consequences 

8. Distribution arrangements 

9. Financial Highlights Information 

**Part B**

10. Cover Page & Table of Contents         11. Trust History 

12. Fund Descriptions, Investments and Risks 

13. Management of the Trust 

14. Control Persons and Principal Holders of Securities         15. Investment Advisory and Other	Services 

16. Brokerage Allocation and Other	Practices

17. Capital Stock and Other Securities 

18. Purchase, Redemptions and Pricing	of Securities Being Offered

19. Taxation of the Trust 

  | Not applicable

Calculation of Performance Data

Financial Statements

**Prospectus**

Cover Page         Application & Back Cover Page        

A Quick Look at Idaho-Tax Exempt Funds

Fees and Expenses 

Investment Objectives        Investment Strategies        Risks

Not applicable (in Annual Report)

Investment Adviser        Not applicable (no restrictions)        

        Pricing of Fund Shares        How to Buy Shares        How to Redeem Shares        Dividends        Tax & Investment Information

Investment Adviser

Financial Highlights

**Statement of Additional Information**

Cover Page        Table of Contents

History of the Fund

Fund Descriptions, Investments and Risks 

Management of the Fund

Principal Holders of Securities

Investment Advisory and other services

Brokerage Allocation

Capital Stock

Purchase, Redemption and Pricing of Shares

Taxation of the Fund

  |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

IV

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| 20. Underwriters

21. Calculations of Performance Data

22. Financial Statements

 

**Part C**

23. Exhibits	      24. Control Persons	

25. Indemnification

26. Business and other Connections      

27. Principal Underwriters	

28. Records	

29. Management Services	

30. Undertakings | Not applicable 

Calculation of Performance Data

Financial Statements

 

 

Exhibits 

Persons Controlled by or Under Common Control with Registrant 

 Indemnification

Business and Other Connections of Investment Adviser 

Principal Underwriters

Location of Accounts and Records

Management Services

not applicable |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

V

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**PART A**

**PROSPECTUS**

 

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**Sextant Mutual Funds**

**Prospectus**March 29, 2006

(graphic omitted)

Growth FundInternational FundShort-Term Bond FundBond Income Fund

 

Like securities of all mutual funds, these securities have not  been approved or disapproved by the Securities and Exchange Commission, and  the Securities and Exchange Commission has not determined if this prospectusis accurate or complete. Any representation to the contrary is a criminal offense. 

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**A Quick Look at  Sextant Mutual Funds**

**Fund Investment Goals****STOCKS:**

> 
Growth Fund – long-term capital growth       International Fund – long-term capital growth

**BONDS:**

> 
Short-Term Bond Fund – capital          preservation and current income      Bond Income Fund – current income 

**Principal Investment Strategies**

The Growth Fund primarily  invests in common stocks of U.S. companies. The International Fund, in contrast,  invests primarily in foreign common stocks. The Funds diversifytheir investments across industries and companies, and generally follow a valueinvestment style. The Funds favor companies trading for less than the adviser’sassessment of intrinsic value, which typically means companies with low price/earningmultiples, low price to cash flow, and higher dividend yields. The Growth Fundmay invest in securities of smaller or newer companies as well as those of well-seasonedcompanies of any size. The International Fund diversifies its investments amongmany countries, favoring those with mature markets (such as Europe and Canada).It currently limits its investments to those securities of foreign issuers thattrade and settle in the U.S. (such as American Depository Receipts). These twoFunds are not designed for investors seeking current income, and do not ordinarilyinvest in debt securities (bonds).

The Short-Term Bond Fund invests primarily  in marketable short-term debt securities.  Under normal circumstances the Fund’s dollar-weighted average maturity  does not exceed three years. The Sextant Bond Income Fund invests primarily  in marketable debt securities. The Fund’s current policy is to maintain  a dollar-weighted average maturity of ten years or more. Both Funds invest  at least  65% of assets in bonds rated within the three highest grades (AAA, AA or A);  and may not invest in a security rated at time of purchase below the fourth  highest grade (BBB).

**Principal Risks of Investing in the Funds**

The value of Fund  shares rise and fall as the value of the stocks and bonds in which the Fund  invests goes up and down. Only consider investing in a Sextant  Fund if you are willing to accept the risk that you may lose money. Fund share  prices, yields, and total returns will change with the fluctuations in the  securities  markets as well as the fortunes of the industries and companies in which the  Funds invest.

The Growth Fund may invest in smaller companies, which involve      higher investment risks in that they often have limited product lines,  markets and resources,      or their securities may trade less frequently and have greater price fluctuation      than those of larger companies. Growth stocks, which can be priced on future      expectations rather than current results, may decline substantially when    expectations are not met or general market conditions weaken.

The International Fund involves  risks not typically associated with investing in U.S. securities. These include  fluctuations in currency exchange rates,  less public information about securities, less governmental market supervision,  and  lack of uniform financial, social and political standards. Foreign countries  have risk of confiscatory taxation, seizure or nationalization of assets, establishment  of exchange controls, adoption of government restrictions, or adverse political  or social developments that affect investments.  The risks inherent in the Short-Term Bond and Bond Income Funds depend primarily  on the terms and quality of the obligations in each Fund’s portfolio,  as well as on bond market conditions. When interest rates rise, bond prices  fall.  When interest rates fall, bond prices go up. Bonds with longer maturities,  such as those held by the Bond Income Fund, usually are more sensitive to interest  rate changes than bonds with shorter maturities. Both Funds entail credit risk,  which is the possibility that a bond will not be able to pay interest or principal  when due. If the credit quality of a bond is perceived to decline, investors  will demand a higher yield, which means a lower price on that bond to compensate  for the higher level of risk.

**Performance**

Variability of returns is illustrated in the following  bar charts and tables, which provide an indication of the risks of investing  in each Fund by showing  changes in Fund performance from year to year and by showing how each Fund’s  average annual returns compare to those of broad-based market indices. A Fund’s  past performance (before and after taxes) is not necessarily an indication  of how a Fund will perform in the future.

| 2 | Sextat Mutual Funds Prospectus | March 29, 2006 |
|---|--------------------------------|----------------|

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**Sextant Growth Fund**(graphic omitted)

| **1996** | **1997** | **1998** | **1999** | **2000** | **2001** | **2002** | **2003** | **2004** | **2005** |
|----------|----------|----------|----------|----------|----------|----------|----------|----------|----------|
| 8.54%    | 26.55%   | 14.71%   | 40.97%   | 6.52%    | -11.99%  | -18.37%  | 26.16%   | 16.44%   | 18.63%   |

Note: Highest return for a quarter was +28.3% (quarter ending Dec. 31, 1999).  Lowest return for a quarter was -23.8% (quarter ending March 30, 2001).

| (for the periods ending December 31, 2005)                    | 1 Year | 5 Years | 10 Years |
|---------------------------------------------------------------|--------|---------|----------|
| Return before taxes                                           | 18.63% | 4.60%   | 11.47%   |
| Return after taxes on distributions**                         | 18.60% | 4.55%   | 10.95%   |
| Return after taxes on distributions and sale of fund shares** | 12.14% | 3.95%   | 9.80%    |
| S&P 500*                                                  | 4.92%  | 0.54%   | 9.06%    |

**The S&P 500® is the Standard & Poor’s Composite Index    of 500 stocks, an unmanaged index of common stock prices.  **After-tax returns are calculated using the historical highest individual  federal marginal income tax rates but do not reflect the impact of any state  or local  taxes. Actual after-tax returns depend on an investor’s tax situation  and likely differ from those shown. They are not relevant to investors who  hold their Fund shares through tax-deferred arrangements, such as IndividualRetirement Accounts.*

 

**Sextant International Fund**(graphic omitted)

| **1996** | **1997** | **1998** | **1999** | **2000** | **2001** | **2002** | **2003** | **2004** | **2005** |
|----------|----------|----------|----------|----------|----------|----------|----------|----------|----------|
| 16.85%   | 15.88%   | 6.15%    | 41.16%   | -7.22%   | -14.77%  | -22.82%  | 49.54%   | 17.40%   | 16.75%   |

Note: Highest return for a quarter was +33.4% (quarter ending Dec. 31, 1999).Lowest return for a quarter was -25.1% (quarter ending Sept. 30, 2002).

| (for the periods ending December 31,        2005)             | 1 Year | 5 Years | 10 Years |
|---------------------------------------------------------------|--------|---------|----------|
| Return before taxes                                           | 16.75% | 6.16%   | 9.76%    |
| Return after taxes on distributions**                         | 16.67% | 6.04%   | 9.34%    |
| Return after taxes on distributions and sale of fund shares** | 11.00% | 5.25%   | 8.37%    |
| AMEX International Index*                                     | 11.97% | 3.24%   | 6.89%    |

**The AMEX International Index® is a capitalization-weighted      index of 50American Depository Receipts.**After-tax returns are calculated using the historical  highest individual federal marginal income tax rates but do not reflect the  impact of any state  or local  taxes. Actual after-tax returns depend on an investor’s tax situation  and likely differ from those shown. They are not relevant to investors who  hold their Fund shares through tax-deferred arrangements, such as IndividualRetirement Accounts.*

| March 29, 2006 | Sextant Mutual Fund Prospectus | 3 |
|----------------|--------------------------------|---|

----

**Sextant Short-Term Bond Fund**(graphic omitted)

| **1996** | **1997** | **1998** | **1999** | **2000** | **2001** | **2002** | **2003** | **2004** | **2005** |
|----------|----------|----------|----------|----------|----------|----------|----------|----------|----------|
| 3.95%    | 6.53%    | 6.19%    | 2.50%    | 7.28%    | 7.57%    | 6.95%    | 3.51%    | 0.96%    | 1.27%    |

Note: Highest return for a quarter was +3.7% (quarter ending Sept. 28, 2001).Lowest return for a quarter was -1.1% (quarter ending June 30, 2004).

| (for the periods ending December 31,        2005)             | 1 Year | 5 Years | 10 Years |
|---------------------------------------------------------------|--------|---------|----------|
| Return before taxes                                           | 1.27%  | 4.01%   | 4.64%    |
| Return after taxes on distributions**                         | 0.11%  | 2.33%   | 2.69%    |
| Return after taxes on distributions and sale of fund shares** | 0.09%  | 2.24%   | 2.36%    |
| Citigroup Government/Corporate 1-3 Index*                     | 1.32%  | 4.18%   | 5.10%    |

**The Citigroup Government-sponsored/Corporate Bonds (1-3 year maturities)  Index is an unmanaged index of investment-grade short-term bond prices.  **After-tax returns are calculated using the historical highest individual  federal marginal income tax rates but do not reflect the impact of any state  or local  taxes. Actual after-tax returns depend on an investor’s tax situation  and likely differ from those shown. They are not relevant to investors who  hold their Fund shares through tax-deferred arrangements, such as IndividualRetirement Accounts.*

 

**Sextant Bond Income Fund**(graphic omitted)

| **1996** | **1997** | **1998** | **1999** | **2000** | **2001** | **2002** | **2003** | **2004** | **2005** |
|----------|----------|----------|----------|----------|----------|----------|----------|----------|----------|
| 0.54%    | 12.70%   | 9.15%    | -3.82%   | 9.29%    | 9.41%    | 13.62%   | 3.80%    | 4.52%    | 1.07%    |

Note: Highest return for a quarter was +5.9% (quarter ending Sept. 30, 2002).Lowest return for a quarter was -6.1% (quarter ending Mar. 29, 1996)

| (for the periods ending December 31,        2005)             | 1 Year | 5 Years | 10 Years |
|---------------------------------------------------------------|--------|---------|----------|
| Return before taxes                                           | 1.07%  | 6.37%   | 5.76%    |
| Return after taxes on distributions**                         | -0.43% | 4.46%   | 3.46%    |
| Return after taxes on distributions and sale of fund shares** | -0.46% | 4.25%   | 2.96%    |
| Citigroup BIG Index*                                          | 2.57%  | 5.93%   | 6.18%    |

**The Citigroup Broad Investment-Grade Bond Index is an unmanaged index of  investment-grade, medium and long term bond prices.  **After-tax returns are calculated using the historical highest individual  federal marginal income tax rates but do not reflect the impact of any state  or local  taxes. Actual after-tax returns depend on an investor’s tax situation  and likely differ from those shown. They are not relevant to investors who  hold their Fund shares through tax-deferred arrangements, such as IndividualRetirement Accounts.*

| 4 | Sextat Mutual Funds Prospectus | March 29, 2006 |
|---|--------------------------------|----------------|

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**Fees and Expenses**

This table describes the fees and expenses  that Fund shareowners may pay if they buy and hold shares of a Fund. There  are no shareowner fees (fees paid    directly from an investment). The Funds impose no sales charge (load) on    purchases or reinvested dividends, no distribution fees, or any deferred    sales charge (load) upon redemption. There are no exchange fees, redemption    fees, or account fees. There are no fees charged to retirement plan accounts.    There is a 2% penalty on redemption of shares within 30 calendar days of    purchase and a fee for any outgoing bank wires. The following table illus-tratesoperating expenses of the Funds for the fiscal year ending November 30, 2005.

|                           | **GROWTH** | **INTERNATIONAL** | **SHORT-TERM BOND** | **BOND INCOME** |
|--------------------------------|------------|-------------------|---------------------|-----------------|
| Management Fees                | 0.83%      | 0.73%             | 0.58%               | 0.43%           |
| Distribution (12b-1) Fees      | NONE       | NONE              | NONE                | NONE            |
| Other Expenses                 | 0.45%      | 0.63%             | 0.65%               | 0.54%           |
| Annual Fund Operating Expenses | 1.28%      | 1.36%             | 1.23%               | 0.97%           |
| Management Fee Waivers         | 0.00%      | 0.00%             | 0.54%               | 0.00%           |
| Net Annual Operating Expenses* | 1.28%      | 1.36%             | 0.70%               | 0.97%           |

**Earnings credits for custody fees further reduced operating expenses and  are not reflected above. For 3/29/2006 through 3/31/2007, expenses for Short-Term  Bond Fund are voluntarily capped at 0.75% and Bond Income Fund are voluntarily  capped at 0.90%. Management fees for both Bond funds are contractually waived  when assets are less than $2 million.*

 

The expenses examples below are intended  to help investors compare the cost of investing in a Sextant Fund with the  cost of investing in other mutual funds.

*The example assumes an investor invests  $10,000 in a Fund for the years indicated and then redeems at the end of those  years. The example also assumes that the  investment has a 5% return each year and that the Fund’s “Annual  Fund Operating Expenses” shown above (without fee waivers or credits  or variation for performance) remain the same. Although actual costs may be  higher  or lower, based on these assumptions an investor’s cumulative expenses  would be:*

|          | **GROWTH** | **INTERNATIONAL** | **SHORT-TERM            BOND** | **BOND INCOME** |
|---------------|------------|-------------------|--------------------------------|-----------------|
| 1 Year Total  | $135       | $143              | $129                           | $102            |
| 3 Year Total  | $421       | $444              | $402                           | $318            |
| 5 Year Total  | $728       | $767              | $695                           | $551            |
| 10 Year Total | $1,600     | $1,681            | $1,530                         | $1,222          |

The trustees are considering a Rule 12b-1 distribution plan that would permit  each Fund to pay distribution and other fees for the sale of shares and services  provided to shareowners. Under the plan, each Fund would pay 0.25% annually  of its average daily net assets. Because these fees, if not offset by voluntary  waivers of management fees, are paid out of a Fund’s assets on an ongoing  basis, over time they could increase the cost of your investment. Before becoming  effective, the 12b-1 distribution plan must be approved by the trustees andshareowners.

 

**Investment Information**

Shareowners receive a financial report  showing the investment returns, portfolios, income and expenses of each Fund  every six months. Investors may obtain current    share prices daily by calling 888/732-6262, on electronic quotation systems    (symbols: SSGFX, SSIFX, STBFX, SBIFX), or on the Internet at www.saturna.com.    This prospectus, financial reports, performance information, month-end portfolio    holdings, proxy voting records and other useful information is also available  at www.saturna.com.

| March 29, 2006 | Sextant Mutual Fund Prospectus | 5 |
|----------------|--------------------------------|---|

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**Investment Objectives, Strategies & Risks**

**The Sextant    Funds provide basic elements to build a low-expense, balanced investment  program. The following table outlines each fund’s particular objectives,  strategies and risks:**

| **Objective**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | **Strategy**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | **Risk**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **Growth Fund**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| The Growth Fund seeks long-term capital appreciation.

(graphic omitted)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | The Growth Fundinvests in a diversified portfolio of U.S. common stocks.      It may invest in securities of smaller or newer companies as well as well-seasoned    companies of any size.                                                                                                                                                                                                                                                                                                                                           | Smaller, high growth companies involve higher investment risks in that      they often have limited product lines, markets and resources, or their      securities may trade less frequently and have greater price fluctuation      than those of larger companies. Growth stocks, which can be priced on future      expectations rather than current results, may decline substantially when    expectations are not met.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| **International Fund**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| The International Fund seeks long-term capital appreciation.

(graphic omitted)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | The International Fund invests in a diversified portfolio      of foreign common stocks. The Fund diversifies its investments geographically      and by type of securities based on the adviser’s evaluation of economic,      market, and political trends outside the U.S. The Fund ordinarily invests      in securities of at least three countries outside the U.S. It limits investments      to those securities of foreign issuers that trade and settle in the U.S.,    such as American Depositary Receipts (ADRs). | Investing in foreign securities or instruments involves      risks not typically associated with investing in U.S. securities. These      include fluctuations in exchange rates of foreign currencies; less public      information with respect to issuers of securities; less governmental super      vision of exchanges, issuers, brokers; lack of uniform accounting, auditing,      and financial reporting standards. There is also a risk of adverse political,    social or diplomatic developments that could affect investment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| These two STOCK funds emphasize a value      approach to investing. The manager looks for securities it believes offer      favorable possibilities for capital appreciation over the next one to four      years. In selecting securities, the manager considers factors such as growth      in revenues and earnings, relative price to earnings and price to book      value ratios, industry position and outlook, and its assessment of management.      The Funds seek tax-efficiency for their shareowners and reduced trading      expenses by limiting portfolio trading.       These Funds may take temporary defensive positions that are inconsistent      with a Fund’s principal common stock investment strategies to protect      principal in adverse market conditions, but which could reduce returns      if stock prices are increasing. Taking a temporary defensive position may    keep a Fund from obtaining its investment objective. |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| **Short-Term Bond Fund**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| The Short-Term Bond Fund seeks capital preservation and current income.

(graphic omitted)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | The Short-Term Bond Fundinvests at least 80% of its assets in short-term      bond securities, under normal circumstances. Its dollar-weighted average      effective maturity (the sum of the market value of each bond times its      number of years to anticipated maturity, divided by the portfolio’s    total market value) normally does not exceed three years.                                                                                                                                                       | The risks inherent in the BOND funds depend primarily on      the terms and quality of the obligations in each Fund’s portfolio,      as well as on market conditions. Interest rate fluctuations affect a Fund’s      net asset value, but not the income received by the Fund from its portfolio      securities. Because prices and yields on debt securities vary over time,      the Fund’s yield also varies. Because of its longer average portfolio      maturity, the Bond Income Fund may decline substantially should interest      rates increase. Both Funds entail credit risk, which is the possibility      that a bond will not be able to pay interest or principal when due. If      the credit quality of a bond is perceived to decline, investors will demand      a higher yield, which means a lower price on that bond to compensate for      the higher level of risk. Bonds with embedded callable options also contain      an element of prepayment risk. When interest rates decline, issuers can      retire their debt and reissue bonds at a lower interest rate. This hurts      investors because yields available for reinvestment will have declined      and upward price mobility on callable bonds is generally limited by the    call price. |
| Bond Income Fund                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| The Bond Income Fund seeks current income.

(graphic omitted)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | The Bond Income Fund invests at least 80% of its assets      in bond securities generating current income, under normal circumstances.    Its dollar-weighted average effective maturity normally exceeds 10 years.                                                                                                                                                                                                                                                                                                                  |
| These two BOND funds normally invest        in: 
- Corporate bonds, meaning marketable bonds payable in U.S. dollars,          rated within the four highest grades assigned by             Moody’s Investors Service, Inc. (Aaa, Aa, A, or Baa) or by Standard & Poor’s    Corporation (AAA, AA, A or BBB); 
- U.S. Government securities; 
- High quality commercial paper; and 
- Bank obligations, including repurchase      agreements, of banks having total        assets        in excess of $1 billion.                                                                                                                                                                                                                                                                                                                                                                                                                                      |

 

| 6 | Sextat Mutual Funds Prospectus | March 29, 2006 |
|---|--------------------------------|----------------|

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**Investment Adviser**

Saturna Capital Corporation, 1300 N. State  Street, Bellingham, Washington 98225, is the Investment Adviser and Administrator  for the Funds. Saturna Capital’s    wholly owned subsidiary, Saturna Brokerage Services, Inc., is a discount    brokerage firm and acts as distributor for the Funds without compensation.    Founded in 1989, Saturna Capital Corporation is also the adviser to Amana    Mutual Funds Trust and to private accounts. Saturna has approximately $340million in assets under management. 

Each Fund pays the Adviser an Investment  Advisory and Administrative Services Fee. The Fee covers compensation for portfolio  management as well as certain  administrative services such as portfolio accounting and reporting, and shareholder  servicing. The base portion of the Fee is 0.60% of average daily net assets  of each Fund per annum, payable monthly. This base Fee is subject to adjustment  up or down depending on the investment performance of each Fund relative toits Morningstar-specified benchmark.

For each month **Growth Fund’s** or **International  Fund’s** total investment  return for the one year period through that month outperforms or underperforms  its benchmark for that period by 1% or more but less than 2%, the base Fee  is increased or decreased by the annual rate of .10% of the Fund’s average  daily net assets for the preceding year. If the outperformance or underperformance  is 2% or more but less than 4%, then the adjustment is at the annual rate of  .20%. If the outperformance or underperformance is 4% or more, the adjustmentis at an annual rate of .30%.

For each month **Bond Income Fund’s** or **Short-Term  Bond Fund’s** total  investment return for the one year period through that month outperforms or  underperforms its benchmark for that period by 1% or more but less than 2%,  the base Fee is increased or decreased by the annual rate of .10% of the Fund’s  average daily net assets for the preceding year. If the outperformance or underperformanceis 2% or more, then the adjustment is at the annual rate of .20%. 

The Sextant  funds are assigned by Morningstar into appropriate categories, which are thebenchmarks used for the computation:

> 
**Sextant Growth Fund:**	Mid-Cap Growth    Funds**Sextant International Fund:**	Foreign  Large Blend Funds**Sextant Short-Term Bond Fund:**	Short-Term Bond Funds**Sextant Bond Income Fund:** Long-Term Bond Funds

For the fiscal year ended November 30, 2005, the aggregate  advisory fee paid (after performance adjustments and fee waivers) was 0.83%,  0.73%, 0.04%, and  0.43% of average net assets for Growth, International, Short-Term Bond, and  Bond Income Funds, respectively. A discussion regarding the basis for the Board’s  approval of the Funds’ advisory contracts through September 2006 is availablein the Annual Report to shareholders, available from the Fund on request. 

Nicholas  Kaiser, MBA, CFA, president and controlling shareowner of Saturna Capital Corporation,  is the primary manager of the Growth and International  Funds. Mr. Kaiser, in combination with members of his family, personally owns  more than 5% of each of the Sextant funds. Phelps McIlvaine, vice president  of Saturna Capital since 1994, is the primary manager of Bond Income and Short-Term  Bond Funds, and also manages Idaho Tax-Exempt Fund, another series of the Trust.  Additional information about the portfolio managers, and their fund ownershipand compensation, is provided in the Statement of Additional Information.

 

**Pricing  of Fund Shares**

Each Fund computes its price per share each business day by dividing  the value of all of its securities and other assets, less liabilities, by  the  number of shares outstanding. The Funds compute their daily prices at the  close of trading on the New York Stock Exchange (generally 4 PM Eastern time)  using market prices. The Funds’ shares are not priced on the days when  New York Stock Exchange trading is closed (weekends and national holidays).  The price applicable to purchases or redemptions of shares of each Fund is  the price next computed after receipt of a purchase or redemption order.  If a market price is not readily available, a fair value is used under procedures  adopted by the Trustees. Using fair value to price securities may result in  a value that is different from a security’s most recent closing price  and from the prices used by other mutual funds to calculate their net assetvalues.

 

**How To Buy Shares**

***IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW  ACCOUNT:** To help the government fight the funding of terrorism and money laundering  activities,  Federal law requires all financial institutions to obtain, verify, and record  information that identifies each person who opens an account. What this means  for you: When you open an account, we will ask for your name, address, date  of birth, and other information that will allow us to identify you. For most  accounts, we will ask for a photcopy of your driver’s license or otheridentifying documents.*

You may open an account and purchase shares by sending  a completed application and a photocopy of a goverment issued identity document  with a check for $1,000  or more ($100 under a group or retirement plan) to the Fund of your choice.  The Funds do not accept initial orders unaccompanied by payment nor by  telephone. The price applicable to purchases and redemptions of Fund shares  is the price next computed after receipt of a purchase or redemption order  by the Fund’s transfer agent (Saturna Capital). There are no sales charges  or loads. The Funds may reject purchases for any reason, such as excessive  trading or anti-money laundering regulations which limit acceptance of third-partychecks and money orders.

| March 29, 2006 | Sextant Mutual Fund Prospectus | 7 |
|----------------|--------------------------------|---|

----

**How To Buy Shares (continued)**

Shareowners may purchase additional shares at any time in minimum amounts  of $25. Once an account is open, purchases can be made by check, by elecronic  funds transfer, or by wire. With your authorization, purchase orders can beentered on-line at www.saturna.com.

Shareowners may authorize the use of electronic  funds transfer (via the Automated Clearing House system [“ACH”])  to purchase or redeem shares by completing the appropriate section of the  application. The authorization  must be received at least two weeks before ACH can be used. To use ACH to purchase  or redeem shares, simply call Saturna Capital. Investors also may wire money  to purchase shares, though the wiring bank typically charges a fee for thisservice. Be sure Saturna Capital is notified when wiring money.

Each time shares    are purchased or redeemed, a confirmation is mailed and/or emailed showing    the details of the transaction as well as the current number    and value of shares held. Share balances are computed in full and fractional    shares, expressed to three decimal places.

The Funds offer several optional    plans and services, including free Individual Retirement Accounts. Other  free services offered by the Funds include an      automatic investment plan, a systematic withdrawal plan, internet access,      Health Savings      Accounts, Education Savings Accounts, and the right to exchange your shares      without charge for any other no-load mutual fund for which Saturna Capital      is the investment adviser. Free materials describing these plans and      applications may be obtained from Saturna Capital.

Shares may also be purchased    and sold through broker-dealers and retirement plan administrators having  agreements with the Funds. These intermediaries        may charge investors, and/or require the adviser/distributor to the Fundsto share revenues for their services.

 

**How to Redeem Shares**

Shareowners may redeem all or part of their investment  on any business day of the Funds. The Funds pay redemptions in US dollars,  and the amount per    share received is the price next determined after receipt of a redemption    request. The amount paid depends on the value of the investments of that    Fund at that day and may be more or less than the cost of the shares beingredeemed.

The Trustees have adopted certain policies and procedures with respect  to frequent trading of Fund shares. The Funds are intended for long-term investment    and  do not permit rapid trading of their shares. Rapid trading may lead to higher  portfolio turnover which can increase costs to shareowners and negatively impact  performance. Shares held less than 30 calendar days, including those held in  omnibus accounts at intermediaries, will be assessed a 2% early-redemptionpenalty (payable to the Fund).

The Fund normally pays for shares redeemed within  three days after a proper instruction is received. To allow time for clearing,  payment for redemption  of investments made by check or ACH may be restricted for up to 14 calendardays. 

There are several methods you may choose to redeem shares.

**Written request**

Write: 

> 
Sextant Mutual Funds	    Box N    Bellingham WA 98227-0596

Or Fax: 360 / 734-0755

You may redeem shares by a written request and choose  one of the following optionsfor the proceeds:

- Redemption check (no minimum) sent to registered owner(s).
- Redemption check      (no minimum) sent as directed if the signature(s) are guaranteed. If    proceeds are to be sent to other than the registered owner(s)      at the last      address, the signatures on the request may need to be guaranteed by    a national bank or trust company or by a member of a national securities    exchange.
- Federal      funds wire. The proceeds ($5000 minimum) may be wired to any bank designated      in the request if the signature(s) are guaranteed as explained      above. You      will be required to describe the use of the funds being redeemed and provide      other details. A wire fee of $25 is charged your account ($35 for international      wires).

**Telephone request**

> 
Call:	800 / 728-8762 or 360 / 734-9900

Unless you notify us to the contrary  in advance, you may redeem shares by a telephone request and choose one ofthe following options for the proceeds:

- Redemption check (no minimum) sent to      registered owner(s).
- ACH transfer ($100      minimum) with proceeds transferred to your bank account as designated    by the ACH authorization on your application. The transfer      agent must receive the ACH authorization at least two weeks before ACH    transfer can        be used.
- Exchange (in at least the minimum established by the Fund being      purchased) for shares of any other Fund for which Saturna Capital is adviser.      If the    exchange is your initial investment into this Fund, the new account will    automatically have the same registration as your original account. 
- Federal funds wire.        Proceeds ($5000 minimum) may be wired as explained above.

| 8 | Sextat Mutual Funds Prospectus | March 29, 2006 |
|---|--------------------------------|----------------|

----

****

**How To Redeem Shares (continued)**

For telephone requests, the Funds will endeavor to confirm that instructionsare genuine and may be liable for losses if they do not. The caller must provide:

the        name of the person making the request, 
the name and address of the registered        owner(s), 
the account number, 
the amount to be withdrawn, and 
the method for payment of the proceeds. 

The transfer agent may also require  a form of personal identification. Neither the transfer agent nor Funds will  be responsible for the results of transactionsthey reasonably believe genuine.

**Check writing**

Shareowners may also redeem by writing checks for amounts of  $500 or more. Upon request, a Fund provides a small book of blank checks for  a $10 fee,    which maythen be used to write checks to any payee. Checks are redeemed at the pricenext determined after receipt by the transfer agent. To use this feature, requestthe Check Writing Privilege on the Application.

 

**Dividends**

Each Fund intends to distribute its net investment income and net  realized capital gains, if any, to its shareowners. Distributions from capital  gains    are paidat the end of November. Growth and International Funds pay income dividends atthe end of November. Short-Term Bond and Bond Income funds pay income dividendsdaily, which are reinvested or distributed monthly. As a result of their investment  strategies, Short-Term Bond and Bond Income funds expect that their dividendswill consist primarily of ordinary income.

Both dividends and capital gains distributions  are automatically reinvested in additional full and fractional shares of  the Fund owned. At your option,you may receive dividends or capital gain distributions in cash. You are notifiedof each dividend and capital gains distribution when paid.

 

**Tax Information**

Dividends are subject to various income taxes, whether they  are paid in cash or reinvested in additional Fund shares, depending on the  type of dividend, thetype of your account, and your city, state, and country of tax residence. Incomedividends paid by the Growth and International Funds will normally be eligiblefor the lower “qualified income dividend” tax rates.

Any redemption,  including exchanges and checks written by shareowners, constitutes a sale for  federal income tax purposes, and investors may realize a capitalgain or loss on the redemption. 

At the end of each calendar year, shareowners  receive a complete annual statement, which should be retained for tax accounting.  Saturna Capital keeps each account’s  entire investment transaction history, and helps shareowners maintain the  tax records needed to determine reportable capital gains and losses as well  as dividendincome.

Each January, the transfer agent reports to each shareowner (consolidated    by taxpayer ID) and to the IRS the amount of each redemption transaction  and the amount of dividends and capital gains distributions. Dividend amounts    represent    the proportionate share the shareowner is to report on a tax return for  the    year. Capital gains may be taxed at different rates, depending on the length    of time the Fund held its investments. Fund dividends and capital gain distributions,    whether paid in cash or invested in additional shares of the Fund, may besubject to federal, state and local income taxes. 

To avoid being subject    to federal backup withholding tax on dividends and distributions, you  must furnish your correct Social Security or Tax IdentificationNumber. 

Shareowners who are not US taxpayers may be subject to a foreign    withholding tax under tax treaty provisions applicable to foreign investors.    Capital        gain distributions paid by the Funds are not subject to foreign withholding.

| March 29, 2006 | Sextant Mutual Fund Prospectus | 9 |
|----------------|--------------------------------|---|

----

**Financial Highlights**

The  following tables help you understand each Fund’s financial performance.  The top section reflects financial results for a single Fund share. The total  returns represent the rate that an investor earned (or lost) on an investment  in each Fund, assuming reinvestment of all dividends and distributions and  without regard to income taxes. Tait Weller & Baker LLP, the independent  registerd public accounting firm for  the Funds, audited this information.  Their report and each Fund’s  financial statements are in the Funds’ annual report (available freeupon request from Saturna Capital). 

**Sextant Growth Fund**

(graphic omitted)

|                                                                                 | **Year ended November 30,**                                      |
|--------------------------------------------------------------------------------------|------------------------------------------------------------------|
| *Selected data per share of          capital stock outstanding throughout the year:* | **2005**                                                         | **2004** | **2003** | **2002** | **2001** |
| **Net asset value at beginning of year**                                             | **$14.20**                                                       | **$12.91** | **$10.64** | **$11.90** | **$13.16** |
|                                                                                 | Income from investment operations                                |  |  |  |  |  |
|                                                                                 | Net investment income                                            | (0.02) | 0.01 | (0.04) | (0.05) | (0.02) |
|                                                                                 | Net gains or losses on securities (both realized and unrealized) | 2.96 | 1.45 | 2.31 | (1.21) | (1.24) |
| Total from investment        operations                                              | 2.94                                                             | 1.46 | 2.27 | (1.26) | (1.26) |
|                                                                                 | *Less distributions*                                             |  |  |  |  |  |
|                                                                                 | Dividends (from net investment income)                           | *(0.00) | (0.01) | - | - | - |
|                                                                                 | Distributions (from capital gains)                               | (0.03) | (0.16) | - | - | - |
| Total distributions                                                                  | (0.03)                                                           | (0.17) | - | - | - |
| Paid in capital from early redemption        penalties                               | *0.00                                                            | - | - | - | - |
|                                                                                 |                                                                  |  |  |  |  |
| **Net asset value at end of year**                                                   | **$17.11**                                                       | **$14.20** | **$12.91** | **$10.64** | **$11.90** |
| **Total return**                                                                     | **20.76%**                                                       | **11.35%** | **21.31%** | **(10.51)%** | **(9.57)%** |
|                                                                                 |                                                                  |  |  |  |  |
| **Ratios/supplemental data**                                                         |                                                                  |  |  |  |  |
| Net assets ($000), end of year                                                       | $9,006                                                           | $5,331 | $4,732 | $3,373 | $3,792 |
| **Raio of expenses to average net assets**                                           |                                                                  |  |  |  |  |
|                                                                                 | Before fee waivers                                               | 1.28% | 0.80% | 1.20% | 1.17% | 0.84% |
|                                                                                 | After fee waivers                                                | 1.24% | 0.78% | 1.14% | 1.11% | 0.78% |
| Ratio of net investment income after waiver to average net assets                    | (0.17)%                                                          | 0.12% | (0.40)% | (0.48)% | (0.18)% |
| **Portfolio turnover rate**                                                          | **4%**                                                           | **8%** | **12%** | **15%** | **8%** |
|                                                                                 | **Amount is less than $0.01*                                     |

 

**Sextant International      Fund**

(graphic omitted)

|                                                                                 | **Year ended November 30,**                                             |
|--------------------------------------------------------------------------------------|-------------------------------------------------------------------------|
| *Selected data per share of          capital stock outstanding throughout the year:* | **2005**                                                                | **2004** | **2003** | **2002** | **2001** |
| **Net asset value at beginning of year**                                             | **$9.40**                                                               | **$8.05** | **$6.07** | **$7.24** | **$8.52** |
|                                                                                 | Income from investment operations                                       |  |  |  |  |  |
|                                                                                 | Net investment income                                                   | 0.05 | 0.03 | 0.05 | 0.02 | 0.04 |
|                                                                                 | Net gains or        losses on securities (both realized and unrealized) | 1.83 | 1.35 | 1.97 | (1.16) | (1.30) |
| Total from investment        operations                                              | 1.88                                                                    | 1.38 | 2.02 | (1.14) | (1.26) |
|                                                                                 | *Less distributions*                                                    |  |  |  |  |  |
|                                                                                 | Dividends (from net investment income)                                  | (0.06) | (0.03) | (0.04) | (0.03) | (0.02) |
| Total distributions                                                                  | (0.06)                                                                  | (0.03) | (0.04) | (0.03) | (0.02) |
| Paid in capital from early redemption penalties                                      | *0.00                                                                   | - | - | - | - |
|                                                                                 |                                                                         |  |  |  |  |
| **Net asset value at end of year**                                                   | **$11.22**                                                              | **$9.40** | **$8.05** | **$6.07** | **$7.24** |
| **Total return**                                                                     | **19.95%**                                                              | **17.11%** | **33.23%** | **-15.80%** | **-14.80%** |
|                                                                                 |                                                                         |  |  |  |  |
| **Ratios/supplemental data**                                                         |                                                                         |  |  |  |  |
| Net assets ($000), end of year                                                       | $3,671                                                                  | $2,053 | $1,650 | $1,150 | $1,445 |
| **Raio of expenses to average net assets**                                           |                                                                         |  |  |  |  |
|                                                                                 | Before fee waivers                                                      | 1.36% | 1.22% | 1.29% | 1.36% | 1.37% |
|                                                                                 | After fee waivers                                                       | 1.25% | 1.10% | 1.10% | 1.17% | 1.17% |
| Ratio of net investment income after waiver to average net assets                    | 0.52%                                                                   | 0.31% | 0.75% | 0.20% | 0.34% |
| **Portfolio turnover rate**                                                          | **5%**                                                                  | **7%** | **4%** | **4%** | **6%** |
|                                                                                 | **Amount is less than $0.01*                                            |

 

| 10 | Sextat Mutual Funds Prospectus | March 29, 2006 |
|----|--------------------------------|----------------|

----

**Sextant Short-Term BondFund**

(graphic omitted)

|                                                                                 | **Year ended November 30,**                                             |
|--------------------------------------------------------------------------------------|-------------------------------------------------------------------------|
| *Selected data per share of          capital stock outstanding throughout the year:* | **2005**                                                                | **2004** | **2003** | **2002** | **2001** |
| **Net          asset value at beginning of year**                                    | **$4.97**                                                               | **$5.09** | **$5.07** | **$5.10** | **$4.95** |
|                                                                                 | Income from investment operations                                       |  |  |  |  |  |
|                                                                                 | Net investment income                                                   | 0.17 | 0.19 | 0.23 | 0.27 | 0.26 |
|                                                                                 | Net gains or losses on securities (both realized        and unrealized) | (0.12) | (0.12) | 0.02 | (0.02) | 0.14 |
| Total from investment        operations                                              | 0.05                                                                    | 0.07 | 0.25 | 0.25 | 0.40 |
|                                                                                 | *Less distributions*                                                    |  |  |  |  |  |
|                                                                                 | Dividends (from net investment income)                                  | (0.17) | (0.19) | (0.23) | (0.28) | (0.25) |
| Total distributions                                                                  | (0.17)                                                                  | (0.19) | (0.23) | (0.28) | (0.25) |
| Paid        in capital from early redemption penalties                               | *0.00                                                                   | - | - | - | - |
|                                                                                 |                                                                         |  |  |  |  |
| **Net asset value at end of year**                                                   | **$4.85**                                                               | **$4.97** | **$5.09** | **$5.07** | **$5.10** |
| **Total return**                                                                     | **0.94%**                                                               | **1.41%** | **5.00%** | **4.90%** | **8.37%** |
|                                                                                 |                                                                         |  |  |  |  |
| **Ratios/supplemental data**                                                         |                                                                         |  |  |  |  |
| Net assets ($000), end of year                                                       | $2,557                                                                  | $2,255 | $2,259 | $2,177 | $2,189 |
| **Raio of expenses to average net assets**                                           |                                                                         |  |  |  |  |
|                                                                                 | Before fee waivers                                                      | 1.23% | 1.14% | 1.17% | 1.14% | 0.94% |
|                                                                                 | After fee waivers                                                       | 0.59% | 0.58% | 0.60% | 0.93% | 0.51% |
| Ratio of net investment income after waiver to average net assets                    | 3.35%                                                                   | 3.80% | 4.47% | 5.23% | 5.45% |
| **Portfolio turnover rate**                                                          | **33%**                                                                 | **37%** | **22%** | **28%** | **28%** |
|                                                                                 | **Amount is less than $0.01*                                            |

 

**Sextant Bond Income      Fund**

(graphic omitted)

|                                                                                 | **Year ended November 30,**                                             |
|--------------------------------------------------------------------------------------|-------------------------------------------------------------------------|
| *Selected data per share of          capital stock outstanding throughout the year:* | **2005**                                                                | **2004** | **2003** | **2002** | **2001** |
| **Net          asset value at beginning of year**                                    | **$5.06**                                                               | **$5.07** | **$4.97** | **$4.81** | **$4.56** |
|                                                                                 | Income from investment operations                                       |  |  |  |  |  |
|                                                                                 | Net investment income                                                   | 0.21 | 0.22 | 0.22 | 0.26 | 0.30 |
|                                                                                 | Net gains or losses on securities (both realized        and unrealized) | (0.14) | (0.01) | 0.10 | 0.16 | 0.25 |
| Total from investment        operations                                              | 0.07                                                                    | 0.21 | 0.32 | 0.42 | 0.55 |
|                                                                                 | *Less distributions*                                                    |  |  |  |  |  |
|                                                                                 | Dividends (from net investment income)                                  | (0.21) | (0.22) | (0.22) | (0.26) | (0.30) |
| Total distributions                                                                  | (0.21)                                                                  | (0.22) | (0.22) | (0.26) | (0.30) |
| Paid        in capital from early redemption penalties                               | *0.00                                                                   | - | - | - | - |
|                                                                                 |                                                                         |  |  |  |  |
| **Net asset value at end of year**                                                   | **$4.92**                                                               | **$5.06** | **$5.07** | **$4.97** | **$4.81** |
| **Total return**                                                                     | **1.40%**                                                               | **4.26%** | **6.52%** | **9.02%** | **12.40%** |
|                                                                                 |                                                                         |  |  |  |  |
| **Ratios/supplemental data**                                                         |                                                                         |  |  |  |  |
| Net assets ($000), end of year                                                       | $3,050                                                                  | $2,643 | $2,272 | $2,105 | $1,965 |
| **Raio of expenses to average net assets**                                           |                                                                         |  |  |  |  |
|                                                                                 | Before fee waivers                                                      | 0.97% | 0.89% | 1.15% | 1.06% | 1.06% |
|                                                                                 | After fee waivers                                                       | 0.94% | 0.87% | 0.97% | 0.72% | 0.34% |
| Ratio of net investment income after waiver to average net assets                    | 4.26%                                                                   | 4.7% | 4.29% | 5.40% | 6.71% |
| **Portfolio turnover rate**                                                          | **4%**                                                                  | **0%** | **0%** | **29%** | **30%** |
|                                                                                 | **Amount is less than $0.01*                                            |

 

| March 29, 2006 | Sextant Mutual Fund Prospectus | 11 |
|----------------|--------------------------------|----|

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| **Saturna Capital**    (grpahic omitted) | Mail application and check to:**SEXTANT MUTUAL FUNDS**      Box N, Bellingham, WA 98227-0596 | For assistance, call:      800/SATURNA or 360/734-9900      FAX 360/734-0755 |
|------------------------------------------|----------------------------------------------------------------------------------------------|------------------------------------------------------------------------------|

| **INVESTMENT APPLICATION FOR:** |
|---------------------------------|
| __Sextant **Growth**            | __Sextant **International** | __Sextant **Bond Income** | __Sextant **Short-Term Bond** |

| **Account Name & Type (select one):** |
|-------------------------------------------|
| __ **Individual**                         | _______________________ | _________ | _______________________ |
|                                      | First Name | Middle Initial | Last Name |
| Social Security Number:                   | __ __ __ - __ __ - __ __ __ __ | Date of birth: |   |
| __ **Joint With**                         | _______________________ | __________ | _______________________ |
|                                      | First Name | Middle Initial | Last Name |
| Social Security Number:                   | __ __ __ - __ __ - __ __ __ __ | Date of birth: |   |
| __ **Gift To Minor**                      |   | as Custodian for |   |
|                                      | Name of Custodian |   | Name of Minor |
| under the                                 | ________________________ | _____________________ |
|                                      | State | Minor's Social Security & Birthdate |
| __ **Other**                              | _____________________________________________________________________ |
|                                      | Indicate name of corporation, other organization or fiduciart capacity.    If a trust, include name(s) of trustees and date of trust instruments. | Tax Identification Number | Name(s) of persons authorized to transact business for the      above entity. |

| **Contact Information:** |
|--------------------------|
| **Mailing Address:**     | _________________________________________________________________________ |
|                     | Street | Apt., Suite, Etc. |
|                     |   |
|                     | City | State | Zip |
| **Telephone:**           | Daytime(___) __________ Home(___) __________      Other(___)__________ |
| **Citizenship:**         | __U.S. Citizen __Resident Alien __Non-resident      Alien |

**Initial Investment:** $______________________ Make check payable to the Fund  being purchased (minimum $1,000).**Internet Services:**Personal email address: __________________________________________________________________  Transaction confirmations and shareowner reports may be sent to my e-mail address:  __ Instead of paper mailings (save paper & postage) __ In addition to paper  mailings Please call to establish PIN for internet access to my account.**ACH Telephone Transfer Priviledge:** __To  transfer funds by ACH at no charge to or from my (our) bank account, I (we)  authorize electronic fund transfers  through the Automated Clearing House (ACH) for my (our) bank account designated.  Please attach a voided check.**Automatic Investment Plan:** __ Invest $ _______ into this Fund on the _____  day of each month (the 15th unless another date is chosen) by ACH transfer  from  my (our) bank account. This plan may be cancelled at any time. Please attach  a voided check.**Check Writing Priviledge:** ($500 per check minimum) ($10 checkbook charge)  __ I (We) hereby request the Custodian to honor checks drawn by me (us) on  my (our) account subject to acceptance by the Funds, with payment to be made  by  redeeming sufficient shares in my (our) account. None of the custodian bank,  Saturna Capital Corporation, nor any Sextant Mutual Fund shall incur any liability  to me (us) for honoring such checks, for redeeming shares to pay such checks,  or for returning checks which are not accepted.  __ Single Signature Authority - Joint Accounts only: (Checks for joint accounts  require both signatures unless this box is marked to authorize checks with  a single signature). By our signatures below, we agree to permit check redemptions  upon the single signature of a joint owner. We hereby agree with each other,  with the Funds and with Saturna Capital Corporation that all moneys now or  hereafter invested in our account are and shall be owned as Joint Tenants withRight of Survivorship, and not as Tenants in Common.

| (graphic omitted)**Identification: You must establish identity by attaching a photocopy            of a driver’s    license, passport or other government-issued document.** |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

The undersigned warrants(s) that I (we) have full authority to make this Application,  am (are) of legal age, and have received and read a current Prospectus and  agree to be bound by its terms. Unless this sentence is struck, I (we) certify,  under penalties of perjury, that I (we) am not subject to backup withholding  under the provisions of section 3406(a)(1)(C) of the Internal Revenue Code.This application is not effective until it is received and accepted.

Signature of Individual (or Custodian) __________________________________________Date ___________________________

  Signature of Joint Registrant (if any) ____________________________________________Date ___________________________

| Additional information about each Fund’s investments      is available in the Funds’ annual and semi-annual shareowner reports.      The Funds’ annual      report includes a discussion of the market conditions and investment strategies      that significantly affected each Fund’s performance during its last      fiscal year. A Statement of Additional Information contains more details,      and is incorporated in this Prospectus by reference. These documents and    other in | formation are available free, upon request, and shareowners      may make inquiries, from:**Saturna Capital Corporation**      1300 N. State St., Bellingham, WA 98225**http://www.saturna.com/**      E-mail: sextant@saturna.com**800-SATURNA** [800-728-8762]      Information about the Funds (including the SAI) can be reviewed and copied    at the SEC’s Public Reference Room in Washington DC | (call 202-942-8090 for information). Reports and other        information about the Funds are also available on the SEC’s EDGAR database (http://www.sec.gov)        and copies may be obtained, upon payment of a duplicating fee, by writing        the Public Reference Section of the SEC, Washington DC 20549-0102 or sending        e-mail to publicinfo@sec.gov. 

Saturna Investment Trust’s Investment Company Act      file number is 811-05071. |
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**PART B**

 

**STATEMENT OF ADDITIONAL INFORMATION**

 

 

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SATURNA INVESTMENT TRUST

**SEXTANT GROWTH FUND  SEXTANT INTERNATIONAL FUND  SEXTANT SHORT-TERM BOND FUND  SEXTANT BOND INCOME FUND**

 

1300 N. State Street  Bellingham, Washington 98225

 

360-734-9900  800-SATURNA

 

**STATEMENT OF ADDITIONAL INFORMATION**  March 29, 2006

This Statement of Additional Information is not a Prospectus.    It merely furnishes additional information concerning the Sextant Growth    Fund, the Sextant International Fund, the Sextant Short-Term Bond Fund, and    the Sextant Bond Fund that is not included in the Prospectus. It should be    read in conjunction with the Prospectus. You may obtain a Prospectus dated    March 29, 2006 and shareowner Annual and Semi-Annual reports without charge    by writing to the address shown above, calling toll-free to 800/728-8762,    and on the Internet at http://www.saturna.com/.

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| **Table of Contents**

History of the Funds  Fund Descriptions, Investments and Risks	  Management of the Funds	  Principal Holders of Securities	  Investment Advisory and Other Services	  Brokerage Allocation	  Capital Stock	  Purchase, Redemption and Pricing of Shares	  Taxation of the Funds	  Calculation of Performance Data	  Financial Statements | Page

 

3        3        7        9        10        13        13        13        13        14        15 |
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| 2 | Sextant Mutual Funds: Statement of Additional Information | March 29, 2006 |
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**History of the Funds**

Saturna  Investment Trust (the “Trust”) is a business trust formed  pursuant to RCW 23.90 of the laws of the State of Washington to operate as  an open-end management company. When formed on February 20, 1987, the name  was Northwest Investors Tax-Exempt Business Trust. The Trust’s name was  changed to Northwest Investors Trust on October 12, 1990. In connection with  the formation of the Sextant Funds, the Trust’s name was changed to SaturnaInvestment Trust on September 28, 1995. 

- The Trust has five separate Funds,      four of which are offered as the Sextant Funds through this Prospectus    and Statement of Additional Information: 
- Sextant Growth Fund (commenced operation      Dec. 30, 1990, known as Northwest Growth Fund until September 28, 1995,    when the investment objective of only      Northwest    stocks was changed), 
- Sextant International Fund (commenced operation September    28, 1995), 
- Sextant Short-Term Bond Fund (commenced operation September 28,    1995), and 
- Sextant Bond Income Fund (commenced operation March 2, 1993, known      as Washington Tax-Exempt Fund until September 28, 1995, when the investment      objective of only    Washington State municipal bonds was changed). 

The fifth Fund, Idaho Tax-Exempt  Fund, is offered through a separate Prospectus and Statement of AdditionalInformation.

 

**Fund Descriptions, Investments andRisks**

***Classification***  Saturna Investors Trust is a “series trust” that presently offersfour Sextant “open-end diversified management investment companies” toinvestors. 

***Investment Strategies and Risks***  The Prospectus describes the principal investment strategies and risks of thosestrategies.

Investing in securities entails both market risk and risk of price    variation in individual securities. This is true even for debt securities    issued by theU.S. Government. By diversifying its investments, each Fund may reduce the riskassociated with owning one or a few individual securities. There is no assurancethat any Fund will achieve its investment objectives.

**Sextant Growth Fund** seeks  long-term growth by investing primarily in common stocks. It may invest in  securities convertible into common stocks and preferred stocks,and in other securities that are suited to the Fund’s investment objectives.The Fund ordinarily does not invest in non-convertible debt securities.

Growth  Fund may invest in securities of smaller or newer companies as well as those  of well-seasoned companies of any size. Smaller companies involve higher  investment risks in that they often have limited product lines, markets and  resources, or their securities may trade less frequently and have greater price  fluctuation  than those of larger companies. Although the Fund invests principally in securities  of U.S. issuers, it may invest up to 5% of its total assets (valued at the  time of investment) in foreign securities, including foreign government obligations  and foreign equity and debt securities that are traded in the U.S. (See Risks  in Foreign Securities, below.)

**Sextant International Fund** invests  at least 65% of its total assets (taken at market value at time of investment)  in foreign  securities (securities of  non-U.S.  issuers), primarily common stocks and American Depository Receipts. The Fund  ordinarily invests in securities of at least three countries outside the U.S.  

The Fund may invest in securities of smaller or newer companies as well as  those of well-seasoned companies of any size. Smaller companies involve higher  investment  risks in that they often have limited product lines, markets and resources,  or their securities may trade less frequently and have greater price fluctuation  than those of larger companies. These factors may be particularly applicable  in smaller or emerging foreign markets.

The Fund diversifies its investments  among several countries and does not concentrate in any particular industry.  The Fund varies its investments geographically  and by type of securities in which it invests based on the adviser’s  evaluation of economic, market, and political trends throughout the world.  The adviser considers  the relative political and economic stability of a company’s countries  of operation in evaluating the potential rewards and risks of an investment  opportunity. The Fund may invest in securities traded in mature markets (such  as Canada, Japan and the United Kingdom), in less developed markets (for example,  Mexico),and in emerging markets (for example, Peru). 

| March 29, 2006 | Sextant Mutual Funds: Statement of Additional Information | 3 |
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As a matter of policy (that can  be changed by the Board of Trustees), the Fund limits its investments to those  securities of foreign issuers that are traded  and settled in the U.S. These include American Depository Receipts (“ADRs”)  that represent underlying shares of foreign issuers. (ADRs are receipts typically  issued by an American bank evidencing ownership of the underlying foreign securities).  Positions in these securities are valued in U.S. dollars, not in the currency  of the underlying security. The Fund may invest in both “sponsored” and “unsponsored” ADRs.  In a sponsored ADR, the issuer typically pays some or all of the expenses of  the depository and agrees to provide its regular shareholder communications  to ADR holders. An unsponsored ADR is created independently of the issuer of  the underlying security. Unsponsored ADR holders generally pay the expenses  of the depository and do not have an undertaking from the issuer of the underlyingsecurity to furnish shareholder communications. 

The Fund may invest in securities  denominated in various currencies. Accordingly, a change in the value of such  currency against the U.S. dollar results in a  corresponding change in the U.S. dollar value of the Fund’s assets denominated  in that currency. Such changes also affect the Fund’s income. Generally,  when a given currency appreciates against the dollar (that is, the dollar weakens)  the value of the Fund’s securities denominated in that currency rises.  When a given currency depreciates against the dollar (that is, the dollar strengthens),  the value of the Fund’s securities denominated in that currency wouldbe expected to decline.

The dividends and interest payable on certain of the  Fund’s foreign portfolio  securities may be subject to foreign withholding taxes, thereby reducing the  net amount of income available for distribution to the Fund’s shareowners.  A shareowner otherwise subject to U.S. federal income taxes may, subject to  various limitations, be entitled to claim a credit or deduction for U.S. federal  income tax purposes for his or her proportionate share of such foreign taxespaid by the Fund.

***Risks in Foreign Securities***  Investors should understand and carefully consider the risks involved in foreign  investing. Investing in foreign securities or instruments involves risks and  opportunities not typically associated with investing in U.S. securities. These  include: fluctuations in exchange rates of foreign currencies; possible imposition  of exchange control regulation or currency restrictions that would prevent  cash from being brought back to the U.S.; less public information with respect  to issuers of securities; less governmental supervision of exchanges, issuers,  brokers; lack of uniform accounting, auditing, and financial reporting standards;  lack of uniform trading practices; less liquidity or greater price volatility  in foreign markets; possible imposition of foreign taxes; or less advantageous  legal, operational, and financial protections applicable to foreign custodial  arrangements. There is also a risk of expropriation or confiscatory taxation,  seizure or nationalization of foreign bank deposits or other assets, establishment  of exchange controls, adoption of foreign government restrictions, or adverse  political, social or diplomatic developments that could affect investment inthese nations.

**Sextant Short-Term Bond Fund** invests primarily in marketable    short-term bond securities. Under normal circumstances, the Fund’s    dollar-weighted averagematurity does not exceed three years. 

**Sextant Bond Income Fund** invests  primarily in marketable long-term bond securities. As an operating policy that  may be  changed by the Board of Trustees, under  normal circumstances the Fund maintains a dollar-weighted average effective  maturity (the sum of the market value of each bond times its number of years  to anticipated maturity, divided by the portfolio’s total market value)in excess of ten years.

The risks and investment returns offered in these Bond  Funds depend primarily on the terms and quality of the obligations in each  Fund’s portfolio,  as well as on market conditions. Interest rate fluctuations affect a Fund’s  net asset value, but not the income received by the Fund from its portfolio  securities. However, because prices and yields on debt securities vary overtime, no specific yield on shares of a Fund can be assured. 

The “effective  maturity” of a debt instrument is the weighted average  period over which the Adviser expects the principal to be paid. It differs  from the stated maturity in that it estimates the effect of expected principal  prepayments and call provisions. With respect to mortgage backed securities  such as GNMA securities, the effective maturity is likely to be substantially  less than the stated maturity of the mortgages in the underlying pools. With  respect to obligations with call provisions, the effective maturity is typically  the next call date on which the obligation reasonably may be expected to be  called. Securities without prepayment or call provisions generally have an  effective maturity equal to their stated maturity. During periods of rising  interest rates, the effective maturity of mortgage backed securities and callableobligations may increase substantially because they become less likely to be  prepaid,which may result in greater net asset value fluctuation.

| 4 | Sextant Mutual Funds: Statement of Additional Information | March 29, 2006 |
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Under normal circumstances,  each of the Bond Funds invests at least 80% its assets (net assets plus any  borrowings for investment purposes, taken at marketvalue at the time of investment) in “bonds,” meaning: 

- Marketable    straight-debt securities of domestic issuers, and of foreign issuers payable    in U.S. dollars, rated at the time of purchase within the three highest  grades assigned by Moody’s Investors Service, Inc. (“Moody’s”)  (Aaa, Aa or A) or by Standard & Poor’s Corporation (“S&P”)  (AAA, AA or A).
- U.S. Government Securities;
- Commercial paper rated Prime-1 by Moody’s    or A-1 by S&P at time of  purchase, or, if unrated, issued or guaranteed by a corporation with any outstanding  debt rated Aa or better by Moody’s or AA or better by S&P; and
- Bank      obligations, including repurchase agreements of banks, having total assets      in excess of $1 billion.

These Funds may also invest in other debt securities  (including those convertible into, or carrying warrants to purchase, common  stocks or other equity interests,  and privately placed debt securities). However, the Funds may not invest in  a security rated at time of purchase below the fourth highest grade assigned  by  Moody’s (Baa) or S&P (BBB). Debt rated Baa or BBB is considered “medium  grade,” though still generally accepted as investment grade. 

U.S. Government  Securities include: (i) bills, notes, bonds and other debt securities, differing  as to maturity and rates of interest, that are issued  by and are direct  obligations of the U.S. Treasury; and (ii) other securities that are issued  or guaranteed as to principal and interest by the U.S. Government or by its  agencies  or instrumentalities. U.S. Government Securities are generally accepted as  being among the safest debt securities with respect to the timely payment of  principal  and interest (but not any premium paid on their purchase), but generally bear  a lower rate of interest than corporate debt securities. However, they are  subject to market risk like other debt securities, and the Funds’ shares  fluctuate in value.

Among the Government Securities the Funds may purchase are  those issued by Government National Mortgage Association (“GNMA”),  Federal National Mortgage Association (“FNMA”) and other agencies.  Securities such as these represent an interest in a pool of mortgages insured  in whole or in part by other  agencies or the U.S. Treasury, depending on the terms of the issue. These issues  may or may not represent the guarantee of the U.S. Treasury.

These “mortgage-backed” debt  securities are entitled to interest and principal payments on mortgages in  the pool as they are paid. During periods  of declining interest rates there is an increased likelihood that these mortgages  will be prepaid, resulting in a loss of the benefit of holding the instrument  to full term, and loss of any premium the Fund may have paid to buy the security.

The  Funds may also invest in floating rate instruments which provide for periodic  adjustments in coupon interest rates that are automatically reset based on  changes in amount and direction of specified market interest rates. To the  extent such  instruments are subject to lifetime or periodic interest rate caps or floors,  such instruments may experience greater price volatility than debt instruments  without such features. 

Medium grade (Baa or BBB) debt securities are obligations  of issuers with less capacity to pay interest and repay principal than those  rated more highly.  Investment in these debt securities involves somewhat greater investment risk,  including  the possibility of issuer default or bankruptcy. An economic downturn could  adversely affect the value of outstanding bonds and the ability of issuers  to repay principal  and interest. During a period of adverse economic changes, including a period  of rising interest rates, issuers of such bonds may experience more difficulty  in servicing their principal and interest payment obligations.

Some issuers  of debt securities choose not to have their securities rated by a rating service.  The Funds may invest in unrated securities that in the adviser’s  opinion are comparable to securities having at least a medium grade rating  and are suitable for investment by the Funds. 

***Fund Policies***  The investment objectives of each Fund are described in the Prospectus and  cannot be changed without approval by vote of a majority of the outstanding  shares of that Fund. 

***Investment Restrictions***  In addition to the restrictions stated in the Prospectus, the Funds shall not  purchase securities on margin or sell securities short or purchase or write  put or call options; purchase “restricted securities” (those which  are subject to legal or contractual restrictions on resale or are otherwise  not  readily marketable); nor invest in oil, gas or other mineral exploration leases  and programs. The Funds shall not make loans to others, except for the purchase  of debt securities, or enter into repurchase agreements. The  Funds shall not invest in securities so as to not comply with Subchapter M  of the

| March 29, 2006 | Sextant Mutual Funds: Statement of Additional        Information | 5 |
|----------------|------------------------------------------------------------------|---|

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 Internal Revenue Code, in that generally at the close of each quarter  of the tax year, at least 50% of the value of each Fund’s total assets  is represented by (i) cash and cash items, government securities, and securities  of other regulated investment companies, and (ii) other securities, except  that with respect to any one issuer in an amount more than 5% of either Fund’s  total assets, and no more than 10% of the Fund’s voting securities of  any one issuer. In addition, the Funds shall not purchase real estate; real  estate limited partnerships (excepting master limited partnerships that are  publicly traded on a national security exchange or NASDAQ’s National  Market System); commodities or commodity contracts; issue senior securities;  provided, however, that a fund may borrow money for extraordinary or emergency  purposes and then only if after such borrowing there is asset coverage of at  least 300% for all such borrowings; nor act as a securities underwriter except  that they may purchase securities directly from the issuer for investment  purposes. Also, no Fund shall purchase or retain securities of any issuer if  the officers or trustees of the Trust or its adviser own more than one-half  of one percent of the securities of such issuer; invest in any company for  the purpose of management or exercising control. No Fund shall invest in the  securities of other open-end investment companies, except in connection with  a merger, consolidation, acquisition, or reorganization or by purchase in the  open market where no commission or profit to a sponsor or dealer results fromthe purchase other than the customary broker’s commission. 

No Fund shall  purchase securities of any issuer in excess of 5% of the Fund’s  total assets or purchase more than 10% of the outstanding voting securities  of any issuer; or concentrate its investments in a single industry beyond  25% of the total value of the Fund; or invest more than 10% of its assets in  the securities of issuers which together have a record of less than three  years continuous operation. No Fund purchases securities if it has outstanding  borrowings exceeding 5% of its net assets. No Fund’s investments in  warrants, valued at the lower of cost or market, shall exceed 5% of the value  of the Fund’s net assets. Included within that amount, but not to exceed  2% of the value of the Fund’s net assets, may be warrants that are not  listed on the New York or American Stock Exchange. Warrants acquired in units  or attached to securities may be deemed to be without value. Notwithstanding  the above, the Funds may purchase securities pursuant to the exercise of subscription  rights, provided that such purchase does not result in the Fund’s ceasing  to be a diversified investment company. Japanese and European corporations  frequently issue additional capital stock by means of subscription rights offerings  to existing shareholders at a price substantially below the market price of  the shares. The failure to exercise such rights would result in a Funds’ interest  in the issuing company being diluted. The market for such rights is not well  developed in all cases and, accordingly, the Funds may not always realize the  full value on the sale of rights. The exception applies in cases where the  limits set forth in the investment restrictions would otherwise be exceeded  by exercising rights or would have already been exceeded as a result of fluctuations  in the market value of the Funds’ portfolio securities with the result  that the Fund would be forced to sell securities at a time when it might nototherwise have done so, or to forego exercising the rights.

Investment objectives  and certain policies of each of the Funds may not be changed without the prior  approval of the holders of the majority of the outstanding  shares of the respective Fund. Objectives and policies which are considered  fundamental and subject to change only by prior approval of the shareowners  include: (1) the primary and any secondary investment objectives; (2) for the  Bond Income and Short-Term Bond Funds, the 80% of assets minimum investment  in bonds; (3) the classification of the Funds as an open-end management company  and the sub-classification of each of the Funds as a diversified company; and(4) the policies listed here under “Investment Restrictions.”

***Temporary  Defensive Position***  When the Adviser considers a temporary defensive investment position advisable,  any Sextant Fund may invest without limitation in high-quality corporate debtobligations or U.S. government obligations or hold cash or cash equivalents.

***Portfolio  Turnover***  The Funds place no restrictions on portfolio turnover and Funds will buy or  sell investments according to the Adviser’s appraisal of the factors  affecting the market and the economy. The Adviser does not anticipate significantvariation to the portfolio turnover rate experienced in the past. 

***Portfolio    Information***  The Funds publish their complete portfolio holdings on the Internet after    each month-end (http://www.saturna.com). They publish annual and semi-annual    reports    containing portfolio holdings. They file periodic reports with the SEC containing    portfolio holdings, which may be published on the Internet. They may provide    dealers, financial services and reporters with month-end portfolio holdings.    The Funds do not disclose mid-month portfolio holdings. Information about    open trades, strategies, and investment programs is proprietary information    of the  Adviser and kept confidential. 

| 6 | Sextant Mutual Funds: Statement of Additional Information | March 29, 2006 |
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**Management of the Funds**

***Boardof Trustees***A Board of five Trustees supervise the Funds: Nicholas Kaiser, John    E. Love, John S. Moore, Gary A. Goldfogel, and Herbert G. Grubel. The Trustees    establish    policies, as well as review and approve contracts and their continuance.  The Trustees also elect the officers, determine the amount of any dividend  orcapital gain distribution and serve on any committees of the Trust. The majorityof Trustess are Independent, having no relationship with the Adviser or its affiliates,and solely consider the interests of shareowners.

***Management  Information***  Staring with the Independent Trustees, the Trustees and officers are:

| (1)      Name, Address and Age                                                                                 | (2)      Position(s)       Held with Trust              | (3)      Principal Occupation(s) during past 5 years                                                                                                               | (4)      Dollar Range of Securities in the Sextant Funds                                                                                        | Number of Portfolios in Saturna fund complex overseen        by Trustee | Other Directorships held by Trustee |
|----------------------------------------------------------------------------------------------------------------|---------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------|-------------------------------------|
| **INDEPENDENT TRUSTEES**                                                                                       |
| John E. Love      1002 Spokane Street      Garfield WA 99130    Age: 73                                        | Independent Trustee  since 1987;  Independent Chairman  | Owner, J.E. Love Co., (agricultural equipment manufacturer)                                                                                                        | Growth:         $10,001-50,000        International:         $1-10,000        Short-Term Bond: over $100,000    Bond Income: $50,001-100,000    | Five                                                                    | None                                |
| John S. Moore, Ph.D.      346 Bayside Road      Bellingham WA 98225    Age: 74                                 | Independent Trustee  since 1993;  Audit Committee Chair | Professor (retired), College of Business and Economics, Western Washington    University                                                                           | Growth:    $10,001-50,000                                                                                                                       | Five                                                                    | None                                |
| Gary A. Goldfogel, M.D.      1500 N. State Street      Bellingham WA 98226    Age: 47                          | Independent Trustee  since 1995                         | Medical Examiner (pathologist).    Owner, Avocet Environmental Testing (laboratory)                                                                                | Growth:      over $100,000      International:      $50,001-100,000      Short-Term Bond:      over $100,000      Bond Income:    over $100,000 | Five                                                                    | None                                |
| Herbert G. Grubel      Apt. 1202 - 125 West Second St.      North Vancouver, BC      Canada V7M 1C5    Age: 71 | Independent Trustee  since 2005                         | Senior Fellow, Fraser Institute;        Professor (Emeritus) of Economics, Simon Fraser University;    Author                                                      | None                                                                                                                                            | Five                                                                    | None                                |
| **INTERESTED TRUSTEE**                                                                                         |
| Nicholas F. Kaiser, MBA*      1300 N. State Street      Bellingham WA 98225    Age: 59                         | President and Trustee since 1990                        | President, Saturna Capital Corporation (the Trust’s          investment adviser)    President, Saturna Brokerage Services (the Trust’s distributor)    | Growth:      over $100,000      International:      over $100,000      Short-Term Bond:      $10,001-50,000      Bond Income:    $10,001-50,000 | Seven                                                                   | Amana Mutual Funds Trust            |
| **OFFICERS WHO ARE NOT TRUSTEES**                                                                              |
| Phelps S. McIlvaine*      1300 N. State Street      Bellingham WA 98225    Age: 52                             | Vice President    since 1994                            | Vice President, Saturna Capital Corporation (the Trust’s        investment adviser)    Treasurer, Saturna Brokerage Services (the Trust’s distributor) | None                                                                                                                                            | N/A                                                                     | N/A                                 |
| Ethel B. Bartolome*      1300 N. State Street      Bellingham WA 98225    Age: 33                              | Secretary    since 2001                                 | Corporate Administrator, Saturna Capital Corporation    (the Trust’s investment adviser)                                                                     | Growth:    $1-10,000                                                                                                                            | N/A                                                                     | N/A                                 |
| Christopher R. Fankhauser*      1300 N. State Street      Bellingham WA 98225    Age: 33                       | Treasurer    since 2002                                 | Chief Operating Officer, Saturna Capital Corporation    (the Trust’s investment adviser)                                                                     | Growth:      $1-10,000      International:      $1-10,000      Bond Income:      $1-10,000      Short-Term Bond:    $1-10,000                   | N/A                                                                     | N/A                                 |

  

| March 29, 2006 | Sextant Mutual Funds: Statement of Additional        Information | 7 |
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| James D. Winship, Esq.*      5406 Diamond Place NE      Bainbridge Island, WA 98110    Age: 57 | Chief Compliance Officer      since 2004 | Attorney      Adjunct of Professor, University of Washington and Seattle Pacific University | Growth:      $1-10,000 | N/A | N/A |
|------------------------------------------------------------------------------------------------|------------------------------------------|---------------------------------------------------------------------------------------------|------------------------|-----|-----|

*Messrs. Kaiser, McIlvaine, Fankhauser, and Winship, and Mrs. Bartolome are “interested  persons” of the Trust as officers and/or employees of the Adviser, Saturna  Capital Corporation. Messrs. Kaiser, Fankhauser, and Winship and Mrs. Bartolome  hold the same positions with Amana Mutual Funds Trust, which has two Fund portfolios,and is also managed by Saturna Capital Corporation. 

Mr. Kaiser is the only    trustee with holdings in other Registered Investment Companies in the Saturna  family, and their aggregate value exceeds $100,000. 

The Board has authority    to establish an Executive Committee with the power to act on behalf of the    Board between meetings and to exercise all powers      of the Trustees in the management of the Trust. No Executive Committee  has been      established at this time. An Audit Committee operating under a specific  charter and consisting of the disinterested directors meets to select the  independent      registered public accounting firm and review all audit reports. The audit      committee held one meeting during the fiscal year. A separate nominating      committee, consisting      of the disinterested directors, met once during the fiscal year. The nominating      committee will consider shareowners for nomination who submit their written    qualifications to the Secretary.

***Compensation***  Effective December 2005, the Trust pays disinterested trustees $300 per        meeting attended, plus reimbursement of travel expenses (pro-rata to      each Fund of        the Trust). Mr. Kaiser receives no compensation from the Trust, nor are        the other officers of the Trust paid for their duties with the Trust;      except that Mr. Winship has been retained by the Trust as Chief Compliance      Officer,        for        which he is compensated. The following table provides the total compensation      paid trustees for the fiscal year ended November 30, 2005.

| Name of Person;    Position                         | Aggregate Compensation from Trust | Pension or Retirement Benefits Accrued as Part of Trust Expenses | Estimated Annual Benefits Upon Retirement | Total Compensation From Trust and Fund Complex Paid to Trustees |
|-----------------------------------------------------|-----------------------------------|------------------------------------------------------------------|-------------------------------------------|-----------------------------------------------------------------|
| John E. Love      Trustee, Chairman                 | $1000                             | $0                                                               | $0                                        | $1000                                                           |
| John S. Moore      Trustee                          | $1000                             | $0                                                               | $0                                        | $1000                                                           |
| Gary A. Goldfogel      Trustee                      | $1000                             | $0                                                               | $0                                        | $1000                                                           |
| Herbert A. Ershig      Trustee (retired Sept. 2005) | $600                              | $0                                                               | $0                                        | $600                                                            |
| Herbert G. Grubel      Trustee (new Dec. 2005)      | $0                                | $0                                                               | $0                                        | $0                                                              |
| Nicholas F. Kaiser      Trustee                     | $0                                | $0                                                               | $0                                        | $0                                                              |

***Code of Ethics***  The Trust, its investment advisor Saturna Capital Corporation, and its principal    underwriter Saturna Brokerage Services, have adopted a common Code of Ethics    under Rule 17j-1 of the Investment Company Act and Rule 204a-1 of the Investment    Advisers Act. The Code permits personnel subject to the Code (as defined    in the Code) to invest in securities, including common stocks and mutual    funds. To prevent conflicts of interest, the Code includes restrictions on    the investing in common stocks that may be purchased by the Funds. A copy    of the Code is available without charge by contacting the Trust or SaturnaCapital Corporation.

***Proxy Voting Policies***  The proxy voting guidelines below summarize Saturna Capital’s positions  on various issues of concern to investors, and give a general indication of  how portfolio securities held in advisory accounts, such as the Funds, willbe voted on proposals dealing with particular issues. The proxy voting guidelines  are just that — guidelines. The guidelines  are not exhaustive and do not include all potential voting issues. Because  proxy issues and the circumstances of individual companies are so varied, there  may be instances when the advisor may not vote in strict adherence to these  guidelines. Regardless of these guidelines, the advisor will always attempt  to vote consistent with specific investment objectives and policies of theFunds. 

Saturna Capital’s investment professionals, as part of their ongoing  review and analysis of all portfolio holdings, are responsible for monitoring  significant corporate developments, including proxy proposals submitted toshareholders. Voting proxies is a responsibility of a Fund’s portfoliomanager. 

| 8 | Sextant Mutual Funds: Statement of Additional Information | March 29, 2006 |
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These guidelines are reviewed and approved  annually by the Trustees. The portfolio manager will refer all issues where  there could be a conflict of interest    (e.g., a familial or business relationship with company management) or uncertainty    of direction to the Trustees for resolution. Disclosure of the proxy voting    record is a responsibility of the Trust’s secretary. After June 30,    information as filed on Form N-PX regarding how the Funds voted proxies relating    to portfolio securities during the most recent 12-month period ended June    30 is available (1) without charge, upon request, by calling Saturna Capital    at 800-SATURNA; (2) through the Trust’s website at http://www.saturna.com;and (3) on the SEC’s website at http://www.sec.gov.

By the followinggeneral categories, absent special circumstances, proxies will be voted:

- **Governance**    - For  proposals calling for a majority of the directors to be independent      of management.
  - For  proposals seeking to increase the independence of board      nominating, audit, and compensation committees.
  - In accordance with the recommendation        of the company’s board of directors         on all shareholder proposals, except it will vote for shareholder proposals      that are consistent with these proxy voting guidelines.
  - For  the election of        the company’s nominees for director, except it        will  withhold votes  for nominees it considers insufficiently committed        or competent.
  - Against  proposals to elect directors on a staggered schedule. 
- **Business Transactions**    - On a  case-by-case basis  on board-approved proposals        to effect  acquisitions, mergers, reincorporations, reorganizations, and        other transactions. 
  - Against  proposals to adopt anti-takeover measures.
  - On              a  case-by-case  basis on proposals to amend a company’s            charter or bylaws.
  - Against  authorization to transact other unidentified,        substantive business at the meeting. 
- **Capitalization**    - On a  case-by-case basis  on board-approved proposals involving            changes to a company’s capitalization, except it will normally            vote:      
  - For  proposals relating to the authorization of additional        common stock. 
  - For  proposals to effect stock splits. 
  - For  proposals authorizing share repurchase                      programs. 
- **Executive Compensation**    - On a  case-by-case basis  on board-approved proposals          relating to executive compensation.      
  - For  compensation programs that relate              executive compensation to a company’s              long-term performance.
  - For  stock option plans unless they could result in                massive dilution or have other provisions clearly not in the        interest of existing shareholders. 

 

**Principal Holders of Securities**

As  of March 1, 2006, the principal holders of record (those with more than 5%  of the outstanding shares) of securities of each Sextant Fund were:

|                                                                   | Name and Address                                                   | Shares  | Percentage |
|------------------------------------------------------------------------|--------------------------------------------------------------------|---------|------------|
| **Growth Fund**                                                        | Helen F. Schloerb      P.O. Box 436      Londonderry VT 05148-0436 | 122,186 | 15.85%     |
| Marion R. Foote      223 Chuckanut Point Road      Bellingham WA 98229 | 64,366                                                             | 8.35%   |
| Markell Kaiser      305 Chuckanut Point Road      Bellingham WA 98229  | 53,957                                                             | 6.99%   |
| **International Fund**                                                 | Helen F. SchloerbP.O. Box 436Londonderry VT 05148-0436             | 127,923 | 19.36%     |
| Markell Kaiser305 Chuckanut Point RoadBellingham WA 98229              | 87,032                                                             | 13.17%  |
| Marion R. Foote223 Chuckanut Point RoadBellingham WA 98229             | 86,655                                                             | 13.12%  |

| March 29, 2006 | Sextant Mutual Funds: Statement of Additional        Information | 9 |
|----------------|------------------------------------------------------------------|---|

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| **Short-Term Bond Fund**                                                                     | Bellingham Anesthesia PS Telfer      2152 Dellesta Drive      Bellingham, WA 98226 | 76,887 | 14.71% |
|----------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------|--------|--------|
| Brian N. Oliver IRA      2965 Haxton Way      Bellingham WA 98226                            | 42,246                                                                             | 8.08%  |
| Helen F. SchloerbP.O. Box 436Londonderry VT 05148-0436                                       | 41,711                                                                             | 7.99%  |
| John E. Love IRA      1002 Spokane St.      Garfield WA 99130                                | 3,8968                                                                             | 7.45%  |
| Thomas B. Callender IRA Rollover      605 Briar Rd.      Bellingham WA 98225-7813            | 37,305                                                                             | 7.14%  |
| Roger A. Barnhart, MD IRA      3017 Vining Street      Bellingham WA 98226                   | 34,109                                                                             | 6.52%  |
| **Bond Income Fund**                                                                         | Helen F. SchloerbP.O. Box 436Londonderry VT 05148-0436                             | 82,174 | 13.30% |
| David K. Heaps IRA Rollover      P.O. Box 1977      Bellingham, WA 98225                     | 50,809                                                                             | 8.22%  |
| Bellingham Anesthesia PS Telfer2152 Dellesta DriveBellingham, WA 98226                       | 39,340                                                                             | 6.36%  |
| Frederick M. Graham      Mary J. Graham      8647 W. Sierra Pinta Drive      Peoria AZ 85382 | 39,269                                                                             | 6.35%  |
| Gary A. Goldfogel IRA Rollover      406 Bayside Rd.      Bellingham, WA 98225                | 32,149                                                                             | 5.20%  |

As of March 1, 2006, officers and Trustees (plus affiliated family membersand entities), as a group, own the following shares of the Funds:

|                     | Shares Owned | Percentage of Outstanding |
|--------------------------|--------------|---------------------------|
| **Growth Fund**          | 298,131      | 38.7%                     |
| **International Fund**   | 348,673      | 52.8%                     |
| **Short-Term Bond Fund** | 137,444      | 26.3%                     |
| **Bond Income Fund**     | 146,119      | 23.7%                     |

 

**Investment Advisory and Other Services**

***InvestmentAdviser and Administrator***Saturna Capital Corporation, 1300 N. StateStreet, Bellingham, Washington 98225, is the Investment Adviser and Administrator(the “Adviser”)  for the Funds. Saturna Capital is also the Funds’ shareowner servicing  agent. Mr. Nicholas Kaiser, by his ownership of the majority of its voting  stock,  is the controlling person of the Adviser. Mr. Kaiser is also a trustee and  president of Saturna Investment Trust, and the principal portfolio manager  of the Growth and International Funds. Mr. Phelps McIlvaine is the principal  portfolio manager of the Short-Term Bond and Bond Income Funds, and a shareownerand member of the board of the Adviser. 

A discussion of the trustees’ approval  of the continuance of the investment advisory and administration agreements  is available in the Trust’s November30, 2005 annual report. 

| 10 | Sextant Mutual Funds: Statement of Additional Information | March 29, 2006 |
|----|-----------------------------------------------------------|----------------|

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***Advisory Fee***  Each of the Sextant Funds monthly pays the Adviser an Advisory and Administrative    Services Fee (the “Base Fee”). The Base Fee covers certain administrative    services such as portfolio accounting, shareholder and financial reporting,    shareholder servicing and transfer agency services. The Base Fee is also    compensation for portfolio management, advice and recommendations on securities    to be purchased, held or sold. The Base Fee is computed at the annual rate    of 0.60% of average daily net assets of each Fund, and is paid monthly. The    Base Fee is subject to adjustment up or down depending on the investmentperformance of the Fund. 

Performance adjustment for Sextant Growth Fund andSextant International 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 year  period through that month outperforms or underperforms the total return of a  specified benchmark for that period by 1% or more but less than 2%, the Base  Fee is increased or decreased by the annual rate of .10% of the Fund’s  average daily net assets for the preceding year. 
- If the outperformance or underperformance      is 2% or more but less than 4%, then the adjustment is at the annual rate    of .20%. 
- If the outperformance or underperformance is 4% or more, the adjustment      is at an annual rate of .30%.

Performance Adjustment for Sextant Bond Income  Fund and Sextant Short-Term Bond 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 year    period through that month outperforms or underperforms the total return of    a specified benchmark for that period by 1% or more but less than 2%, the Base    Fee is increased or decreased by the annual rate of .10% of the Fund’s    average daily net assets for the preceding year. 
- If the outperformance or underperformance        is 2% or more, then the adjustment is at the annual rate of .20%. 

|                                        | Base Fee annual rate             | Performance Adjustment annual rate |
|---------------------------------------------|----------------------------------|------------------------------------|
| <1% more of less than benchmark          | 1-2% more or less than benchmark | 2-4% more or less than benchmark   | >4% more or less than benchmark |
| Growth Fund & International Fund        | 0.60%                            | 0.00%                              | +/- 0.10% | +/- 0.20% | +/- 0.30% |
| Bond Income Fund & Short-Term Bond Fund | 0.60%                            | 0.00%                              | +/- 0.10% | +/- 0.20% | +/- 0.30% |

Total return investment performance as calculated and published by Morningstar,  Inc. for each Sextant fund Morningstar category is used as the benchmark for  comparison purposes. The categories currently assigned by Morningstar are:

- Sextant Growth Fund: “Mid-cap Growth Funds”
- Sextant International    Fund: “Foreign Large Blend Funds”
- Sextant Bond Income Fund: “Long-Term    Bond Funds” 
- Sextant Short-Term Bond Fund: “Short-Term Bond Funds” 

The Adviser    has undertaken to limit expenses of Short-Term Bond Fund to 0.60% through  March 31, 2007 and waives its investment advisory and administrative  fee for either Bond Fund completely so long as assets of that Fund are less  than $2 million.

For each of the last three fiscal years, the advisory fees    (after performance adjustments and expense limitations) each Fund paid Saturna    Capital were:

|                             | 2003    | 2004    | 2005    |
|----------------------------------|---------|---------|---------|
| **Sextant Growth Fund**          | $31,950 | $18,702 | $56,759 |
| **Sextant International Fund**   | $7,914  | $11,159 | $21,079 |
| **Sextant Short-Term Bond Fund** | $4,887  | $3,461  | $962    |
| **Sextant Bond Income Fund**     | $15,620 | $10,560 | $12,864 |

 

| March 29, 2006 | Sextant Mutual Funds: Statement of Additional        Information | 11 |
|----------------|------------------------------------------------------------------|----|

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***Portfolio Managers***

| Portfolio Manager:                                                            | **Nicholas Kaiser**                                                                                         | **Phelps McIlVaine**                                                                                           |
|-------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------|
| Trust portfolios served as primary manager and manager's    ownership (range) | Sextant Growth Fund        Sextant International Fund    (11/30/2005 assets of $100,000-500,000, each Fund) | Sextant Bond Income Fund        Sextant Short-Term Bond Fund        Idaho Tax-Exempt Fund    (none, all Funds) |
| Other investment company portfolios served as primary    manager:             | Amana Growth Fund        Amana Income Fund    (11/30/2005 assets of $169 million)                           | None                                                                                                           |
| Other pooled investment vehicles served as primary    manager:                | Two        (12/31/2005 assets of $13 million, which are all managed with a performance    fee)              | None                                                                                                           |
| Other accounts:                                                               | Twenty-eight    (12/31/2005 assets of $17 million)                                                          | One    (12/31/2005 assets of $3 million)                                                                       |

All Saturna Capital employees, including Nicholas Kaiser, Phelps McIlvaine  and other portfolio managers, are paid an annual salary, as set by the board  of Saturna Capital. The board also pays bonuses, that are partly dependent  on the profits of Saturna Capital and may also reflect the results of specific  managed accounts or specific businesses of Saturna Capital. As shareowners  of Saturna Capital Corporation, Messrs. Kaiser and McIlvaine may benefit from  any increase in its value per share that might result from its operations or  profits. All Saturna Capital employees are eligible for a retirement plan,  health and other benefits, and a stock option plan. Stock options are annually  awarded on the basis of years of service, and not individual performance. Mutual  fund portfolio managers are paid a monthly bonus (which may be shared with  other employees) when a fund achieves an overall rating of 4 or 5 stars from  Morningstar. The bonus is 1% of the adviser’s net monthly fee (which  is based on both assets and performance) for a 4-star rating, and 2% of the  monthly fee for a 5-star rating. Mr. Nicholas Kaiser was paid a total of $81,360  in compensation by Saturna Capital in calendar 2005. Mr. Phelps McIlvaine waspaid a total of $63,978 in calendar 2005.

As explained above, the four Sextant  funds of the Trust pay an advisory fee that is based upon performance as well  as assets in each Sextant fund. The  portfolio equity transactions of the funds are normally executed by Saturna  Brokerage Services, an affiliate of the Adviser, but involve no conflict of  interest because the Adviser has agreed to waive entirely commission charges  normally paid on security transactions. The Adviser has adopted a Code of Ethics  which governs trading by portfolio managers to avoid conflicts of interest.  To avoid any single managed account of the Adviser getting a trading advantage,  portfolio transactions are done as a “bunched” order then allocatedpro-rata to individual accounts.

***Shareowner Services***  Under the Advisory agreement, Saturna Capital also provides services as the  transfer agent and dividend-paying agent for the Funds. As transfer agent,  Saturna furnishes to each shareowner a statement after each transaction, an  historical statement at the end of each year showing all transactions during  the year, and Form 1099 tax forms. Saturna also, on behalf of the Funds, responds  to shareowners’ questions or correspondence. Further, the transfer agent  regularly furnishes the Funds with current shareowner lists and information  necessary to keep the shares in balance with the Funds’ records. The  transfer agent performs the mailing of all financial statements, notices and  prospectuses to shareowners. The transfer agent maintains records of contributions,  disbursements and assets as required for IRAs and other qualified retirementaccounts. These transfer agent services are included in the Base Fee. 

***Custodian***  National City Bank, Indiana, of Indianapolis, National City Center, Indianapolis,  Indiana 46255 is the custodian of the Funds. As custodian for the Funds, the  bank holds in custody all securities and cash, settles for all securities transactions,  receives money from sale of shares and on order of the Funds pays the authorized  expenses of the Funds. When investors redeem Fund shares, the proceeds arepaid to the shareowner from an account at the custodian bank.

***Independent Registered    Public Accounting Firm***  Tait, Weller and Baker LLP, 1818 Market Street, Suite 2400, Philadelphia, PA    19103 is the independent registered public accounting firm for the Funds.    The accountants  conduct an annual audit of the Funds as of November 30 each year, prepare the  tax returns of the Funds and assist the Adviser in any accounting mattersthroughout the year.

***Principal Underwriter***  The Adviser’s wholly-owned subsidiary, Saturna Brokerage Services, Inc.,  1300 N. State Street, Bellingham WA 98225 is a discount brokerage firm and  acts as distributor for the Funds without compensation. Mr. Nicholas Kaiser,  an affiliated person of the Funds, is President of Saturna Brokerage Services,Inc.

| 12 | Sextant Mutual Funds: Statement of Additional Information | March 29, 2006 |
|----|-----------------------------------------------------------|----------------|

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**Brokerage Allocation**

The  placing of purchase and sale orders as well as the negotiation of commissions    is performed by the Adviser and is reviewed by the Board of Trustees. The    Adviser may make allocation of brokerage to any broker in return for research    or services and for selling shares of any fund of Saturna Investment Trust.    Brokers may provide research or statistical material to the Adviser, but    this information is only supplemental to the research and other statistics    and material accumulated and maintained through the Adviser’s own efforts.    Any such supplemental information may or may not be of value or used in making    investment decisions for the Funds or any other account serviced by the    Adviser. Research services provided by brokers through which the Funds effect    securities transactions may be used by the Funds’ investment adviser    in servicing all of its accounts and not all of these services may be usedby the adviser in connection with the Funds.

The primary consideration in    effecting securities transactions for the Funds is to obtain the best price    and execution which in the judgment of the Adviser  is attainable at the time and which would bring the best net overall economic  result to a Fund. Factors taken into account in the selection of brokers include  the price of the security, commissions paid on the transaction, the efficiency  and cooperation with which the transaction is effected, the expediency of making  settlement and the financial strength and stability of the broker. The Adviser  may negotiate commissions at a rate in excess of the amount another broker  would have charged if it determines in good faith that the overall net economic  result is favorable to the Fund, and is not required to execute trades in “over-the-counter” securities  with primary market-makers if similar terms are available elsewhere. The Adviser  evaluates whether brokerage commissions are reasonable based upon available  information about the general level of commissions paid by similar mutual fundsfor comparable services.

When consistent with best execution, brokerage is primarily    directed to Saturna Brokerage Services, Inc., a wholly owned subsidiary of    the adviser, which engages    in a discount brokerage business. Saturna Brokerage Services has agreed to    execute transactions for the Funds without any commissions for calendar 2006.    The Trustees review brokerage activity in detail at each regular meeting.  Meetings are held on a quarterly schedule. For each of the last three fiscal  years,  the commissions each Fund paid Saturna Brokerage were:

|                             | 2003   | 2004   | 2005 | % of 2005 aggregrate brokerage commissions paid Saturna Brokerage | % of 2005 aggregate dollar amount of transactions involving the payment      of commissions through Saturna Brokerage |
|----------------------------------|--------|--------|------|-------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------|
| **Sextant Growth Fund**          | $2,002 | $2,959 | $279 | 100%                                                              | 100%                                                                                                                  |
| **Sextant International Fund**   | $1,287 | $977   | $0   | 100%                                                              | 100%                                                                                                                  |
| **Sextant Short-Term Bond Fund** | $0     | $0     | $0   | 0                                                                 | 0                                                                                                                     |
| **Sextant Bond Income Fund**     | $0     | $0     | $0   | 0                                                                 | 0                                                                                                                     |

 

**Capital Stock**

Each  Fund of Saturna Investment Trust is divided into shares of beneficial interest.  The shares of each separate Fund of the Trust have equal voting    rights. All shares are fully paid, non-assessable, transferable and with    rights of redemption, and are not subject to preemptive rights. The Trust    is not required to hold annual shareowner meetings. However, special meetings    may be called for such purposes as electing or removing Trustees, changing    fundamental policies, or voting on approval of an advisory contract. On issues    relating solely to a single Fund, only the shareowners of that Fund are entitled    to vote. All dividends and distributions for each Fund shall be distributedto shareowners in proportion to the number of shares owned.

 

**Purchase, Redemption    and Pricing of Shares**

See*How to Buy Shares, How to Redeem Shares and Pricing  of Fund Shares* in the Prospectus for an explanation about the ways to  purchase or redeem shares.  Both purchases and redemptions are made at net asset value per share. A 2%early redemption penalty may apply.

In addition to normal purchases or redemptions,  the shares of the Funds may be exchanged for shares of other funds managed  by Saturna Capital. Exchanges  will be made at no charge upon written request or by telephone if the shareowner  has previously authorized telephone privileges. A gain or loss for federal  tax purposes will be realized upon redemption of any shares for the purposesof an exchange as described above.

Price (net asset value) per share is determined  by dividing the value of all securities and other assets, less liabilities,  by the number of shares outstanding.  The daily price is determined for each Fund as of the close of trading on the  New York Stock Exchange (generally 4 p.m. New York time) on each day the Exchange  is open for trading. The Exchange is generally closed on New Year’s Day,  Martin Luther King Day, President’s Day, Good Friday, Memorial Day, Independence  Day, Labor Day, Thanksgiving and Christmas. See the balance sheet in the Annual  Report or Semi-Annual Report for a specimen sheet showing how the Funds calculate  net asset value, which is the price used for both purchase and redemption ofshares.

 

**Taxation of the Funds**

Saturna Investment Trust is organized as a “series” investment  company. Each Fund of the Trust is a separate economic entity with separate  assets and liabilities and separate income streams. The shareowners of each  separate Fund may look only to that fund for income, capital gain or loss,  redemption, liquidation, or termination. Each Fund has separate arrangementswith the Adviser. Assets of each Fund are segregated. 

| March 29, 2006 | Sextant Mutual Funds: Statement of Additional        Information | 13 |
|----------------|------------------------------------------------------------------|----|

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The creditors and shareowners of each Fund are limited to the assets of that  fund for recovery of charges, expenses and liabilities. Each Fund of the Trust  conducts separate voting on issues relating solely to that fund, except as  required by the Investment Company Act. The tax status and tax consequences  to shareowners of each Fund differ, depending upon the investment objectives,operations, income, gain or loss, and distributions from each Fund.

Each Fund  intends to distribute to shareowners substantially all of its net investment  income and net realized capital gains, if any, and to comply, as  they have since inception, with the provisions of the Internal Revenue Code  applicable to regulated investment companies (Subchapter M), which relievemutual funds of federal income taxes on the amounts so distributed. 

At November    30, 2005, Short-Term Bond had capital loss carryforwards of $40,485, of which    $766 expires in tax year 2005, $4,467 expires in 2007, $9,191 expires in  2008, $15,099 expires in 2009 and $4,422 expires in 2011 and $6,540 expires  in  2012; Bond Income had capital loss carryforwards of $22,124, of which $5,730  expires    in 2007, $2,141 expires in 2009 and $14,253 expires in 2010; and International    had capital loss carryforwards of $153,967, of which $52,590 expires in 2009,    $70,706 expires in 2010 and $30,671 expires in 2011, subject to regulation.    Prior to their expiration, such loss carryforwards may be used to offset  future net capital gains realized for federal income tax purposes.

If shareowners do  not furnish the transfer agent with a valid Social Security or Tax Identification  Number and in certain other circumstances, the transfer  agent is required to withhold 28% of income. Dividends and capital gains distributions  to shareowners who are nonresident aliens may be subject to a 30% United States  foreign withholding tax under the existing provisions of the code applicable  to foreign individuals and entities unless a reduced rate of withholding or  a withholding exemption is provided under applicable treaty law. If the IRS  determines that a Fund should be fined or penalized for inaccurate or missing  or otherwise inadequate reporting of a Tax Identification Number, the amount  of the IRS fee or penalty will be directly assessed to the shareowner accountinvolved.

 

**Calculation of Performance Data**

Average annual Total Return and Current Yield  information may be useful to investors in reviewing a Fund’s performance.  However, certain factors should be taken into account before using the information  as a basis for comparison  with alternative investments. Additional calculations are made to illustrate  possible taxes payable on distributions and sale of shares. The performance  for any given past period is not an indication of future rates of return oryield on its shares. 

The figures regarding multi-year total return reflect    the operations of Sextant Growth Fund and Sextant Bond Income Funds using  their different investment  objectives prior to September 1995.

**Annual Average Total Return (before taxes)**  For each of the following periods ended November 30, 2005, the average annual    compounded Total Returns of each Fund (before taxes) were:

|                             | 1 year | 5 years | 10 years | Commencement |
|----------------------------------|--------|---------|----------|--------------|
| **Sextant Growth Fund**          | 20.76% | 5.68%   | 11.22%   | 9.47%        |
| **Sextant International Fund**   | 19.95% | 6.07%   | 9.63%    | 9.43%        |
| **Sextant Short-Term Bond Fund** | 0.94%  | 4.16%   | 4.68%    | 4.70%        |
| **Sextant Bond Income Fund**     | 1.40%  | 6.71%   | 5.93%    | 5.56%        |

Average annual Total Return (before taxes) quotations for various periods  illustrated are computed by finding the average annual compounded rate of return  over the period quoted that would equate the initial amount invested to theending redeemable value according to the following formula:

P (l + T)*n* = ERV

Where	P = a hypothetical initial Payment of $1,000  T = average annual Total return  n = number of years  ERV = Ending Redeemable Value of the $1,000 payment made at the beginning of  the period.

To solve for average Total Return, the formula is as follows:

T = ( ERV/P)1/n    - 1

**Average Annual Total Return (after taxes on distributions)**

For  each of the following periods ended November 30, 2005, the average annual compounded  Total Returns of each Fund (after taxes on distributions)      were:

|                             | 1 year | 5 years | 10 years | Commencement |
|----------------------------------|--------|---------|----------|--------------|
| **Sextant Growth Fund**          | 20.74% | 5.64%   | 10.70%   | 9.14%        |
| **Sextant International Fund**   | 19.86% | 5.95%   | 9.21%    | 9.02%        |
| **Sextant Short-Term Bond Fund** | -0.24% | 2.44%   | 2.71%    | 2.74%        |
| **Sextant Bond Income Fund**     | -0.02% | 4.75%   | 3.61%    | 3.75%        |

Average annual Total Return (after taxes on distributions) quotations for  various periods illustrated are computed by finding the average annual compounded  rate of return over the period quoted that would equate the initial amountinvested to the ending redeemable value 

| 14 | Sextant Mutual Funds: Statement of Additional Information | March 29, 2006 |
|----|-----------------------------------------------------------|----------------|

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according to the following formula:

P (l + T)*n* = ATVD

Where	P = a hypothetical initial Payment of $1,000  T = average annual Total return (after any federal income taxes on distributions)  n = number of years  ATVD = Ending Value of the hypothetical $1,000 payment made at the beginning  of the period after taxes on fund distributions but not after any federal income  taxes on redemption

 

**Average Annual Total Return (after taxes on distributions and redemption)**

For each of the following periods ended November 30, 2005, the average annual  compounded Total Returns of each Fund (after taxes on distributions and redemptions)  were:

|                             | 1 year | 5 years | 10 years | Commencement |
|----------------------------------|--------|---------|----------|--------------|
| **Sextant Growth Fund**          | 13.54% | 4.90%   | 9.56%    | 7.33%        |
| **Sextant International Fund**   | 13.08% | 5.18%   | 8.25%    | 8.08%        |
| **Sextant Short-Term Bond Fund** | -0.26% | 2.34%   | 2.38%    | 2.41%        |
| **Sextant Bond Income Fund**     | -0.06% | 4.54%   | 3.11%    | 3.04%        |

**Average annual Total Return (after taxes on distributions)**quotations  for various periods illustrated are computed by finding the average annual  compounded rate of return over the period quoted that would equate the initial  amount invested to the ending redeemable value according to the following formula:

P (l + T)*n* = ATVDR

Where	P = a hypothetical initial Payment of $1,000  T = average annual Total return (after any federal income taxes on distributions    and redemption)  n = number of years  ATVDR = Ending Value of the hypothetical $1,000 paymentmade at the beginning  of the period after any federal income taxes on fund distributions and redemption

**Current Yield** is computed by dividing the net investment  income, as defined by the Securities and Exchange Commission, over a rolling  30 day period for which the yield is presented by the average number of shares  eligible to receive dividends for the period over the maximum offering price  per share on the last day of the period, and annualize the results. The formula  used is:

Yield = 2[( a-b/cd +1)*6* -1]

Where   a = interest and dividends accrued during the period   b = expenses accrued for the period (net of reimbursements)   c = the average daily number of shares outstanding during the period that were  entitled to receive dividends   d = the price per share on the last day of the period

The current yield on the Sextant Growth Fund, the Sextant International Fund,  Sextant Short-Term Bond Fund, and the Sextant Bond Income Fund, for the 30  day period ending November 30, 2005 was 0.00%, 0.00%, 4.56%, and 5.03%, respectively. 

 

**Financial Statements**

The most recent audited annual report accompanies this Statement of Additional  Information. 

There is incorporated into this Registration Statement the following financial  information in the Annual Report to shareowners for the fiscal year ended November  30, 2005. Filed as Exhibit A hereto:

> 
Report of Tait, Weller & Baker LLP, Independent Registered Public Accounting    Firm.     Statement of Assets and Liabilities as of November 30, 2005.     Statement of Operations - Year ended November 30, 2005.     Statements of Changes in Net Assets - years ended November 30, 2005, and    2004.     Investments - as of November 30, 2005.     Notes to Financial Statements.

 

| March 29, 2006 | Sextant Mutual Funds: Statement of Additional        Information | 15 |
|----------------|------------------------------------------------------------------|----|

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| 16 | Sextant Mutual Funds: Statement of Additional Information | March 29, 2006 |
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**PART A**

 

**PROSPECTUS**

 

 

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| Like securities of all mutual funds, these securities        have not been approved or disapproved by the Securities and Exchange        Commission, and the Securities and Exchange Commission has not determined        if this prospectus is accurate or complete. Any repre-sentation to the        contrary is a criminal offense.

 

**PROSPECTUS**        March 29, 2006 | **IDAHO****TAX-EXEMPT FUND**

(graphic omitted) |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------|

A Quick Look at Idaho Tax-Exempt    Fund

***Fund Investment Goals*****Idaho Tax-Exempt Fund** seeks    to provide income free from federal income, federal alternative minimum    and Idaho state income taxes, with a secondary objective of capital preservation.

***Principal Investment Strategies*****Idaho Tax-Exempt Fund** invests    in debt securities issued by political subdivisions of the State of Idaho.    These municipal bonds, notes and commercial paper may be in various forms,    including general obligation bonds, revenue bonds, mortgage bonds, certificates    of participation, local improvement district bonds, and refunding bonds.

At time of purchase, a bond must be rated “A” or equivalent by  a national bond rating agency. The Fund may also invest in non-rated bonds  if they are of equivalent quality in the opinion of the Adviser. Factors included  in bond evaluations include such information as the bond district’s financial  position, population size, employment trends, economic activity and diversification.  The portfolio’s dollar-weighted average effective maturity is expected  to range between 6 and 15 years.

**Principal Risks of Investing in the Fund**  The value of Fund shares rise and fall as the value of the bonds in which the    Fund invests goes up and down. The risks inherent in the Fund depend primarily    on the terms and quality of the obligations in the Fund’s portfolio,    as well as on market conditions. When interest rates rise, bond prices fall.    When interest rates fall, bond prices go up. Bonds with longer maturities,    such as those held by the Fund, usually are more sensitive to interest rate    changes than bonds with shorter maturities. Only consider investing in the    Fund if you are willing to accept the risk that you may lose money.

The Fund entails credit risk, which is the possibility that a bond will not  be able to pay interest or principal when due. If the credit quality of a bond  is perceived to decline, investors will demand a higher yield, which means  a lower price on that bond to compensate for the higher level of risk. If a  security held by the Fund defaults on payment of interest or principal, the  Fund’s income, ability to preserve capital, and liquidity would all be  adversely affected. 

Fund investments are susceptible to factors adversely affecting Idaho.  Investing only in Idaho bonds means the Fund is less diversified than other  mutual funds, and relatively few bond price changes may lead to underperformance  compared to investments selected in greater number and/or from a wider universe.

The Fund is vulnerable to income tax rate changes, either at the Idaho or  federal level, since part of municipal securities’ value is derived from  the recipient’s ability to exclude interest payments from taxation. 

----

**Variability of Returns**

This bar chart and table provide an indication of the risks of investing in  the Fund by showing changes in Fund performance from year to year and by showing  how the Fund’s average annual returns compare to a broad-based market  index. A Fund’s past performance (before and after taxes†) is not  necessarily an indication of how a Fund will perform in the future.

| 1996  | 1997  | 1998  | 1999   | 2000  | 2001  | 2002  | 2003  | 2004  | 2005  |
|-------|-------|-------|--------|-------|-------|-------|-------|-------|-------|
| 3.92% | 7.11% | 6.02% | -2.75% | 9.96% | 4.16% | 9.01% | 4.03% | 2.44% | 1.61% |

Note: Highest return for a quarter was +4.2% (quarter ending Sept. 30, 2002).  Lowest return for a quarter was -2.3% (quarter ending June 30, 1999).

| **Annual            Average Total Returns**                   |
|---------------------------------------------------------------|
| (for the years ending December 31, 2005)                      | 1 Year | 5 Years | 10 Years |
| Return before taxes                                           | 1.61% | 4.22% | 4.49% |
| Return after taxes on distributions**                         | 1.56% | 4.21% | 4.47% |
| Return after taxes on distributions and sale of fund shares** | 1.49% | 3.87% | 3.69% |
| Lehman Municipal Composite                                    | 3.51% | 5.59% | 5.71% |

*The Lehman Municipal Composite Index is a widely recognized, unmanaged index  of municipal bond prices, without reduction for fees, expenses or taxes.  **After-tax returns are calculated using the historical highest individual  federal marginal income tax rates but do not reflect the impact of any state  or local taxes. The Fund normally pays dividends exempt from federal and Idaho  income taxes, but may occasionally pay small amounts of taxable dividends.  Actual after-tax returns depend on an investor’s tax situation and likely  differ from those shown. These after-tax illustrations are not relevant to  retirement plan, corporate, trust or other investors taxed at special rates.

| *2* | *Idaho Tax-Exempt Fund Prospectus* | *March 29, 2006* |
|-----|------------------------------------|------------------|

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**Fees and Expenses**

This table describes the fees and expenses that Fund shareowners may pay if  they buy and hold shares of the Fund. There are no shareowner fees (fees paid  directly from an investment). The Fund imposes no sales charge (load) on purchases  or reinvested dividends, no distribution fees, or any deferred sales charge  (load) upon redemption. There are no exchange fees, redemption fees, or account  fees. There is a 2% penalty for redemption of shares within 30 calendar days  of purchase and a fee for any outgoing bank wires. The following table illustrates  operating expenses of the Fund for the fiscal year ending November 30, 2005.

| **ANNUAL            FUND OPERATING EXPENSES        (expenses that are deducted from Fund assets)**                                                   |
|------------------------------------------------------------------------------------------------------------------------------------------------------|
| Management Fees                                                                                                                                      | 0.50% |
| Distribution (12b-1) Fees                                                                                                                            | NONE |
| Other Expenses                                                                                                                                       | 0.41% |
| Annual Fund Operating Expenses                                                                                                                       | 0.91% |
| *For the fiscal year            ending November 30, 2005, earnings credits for custody fees further            reduced operating expenses by 0.03%.* |

Expenses Example

*The example below is intended to help investors compare the cost of investing    in Idaho Tax-Exempt Fund with the cost of investing in other mutual funds.    The example assumes an investor invests $10,000 in a Fund for the years indicated    and then redeems at the end of those years. The example also assumes that    the investment has a 5% return each year and that the Fund’s “Annual    Fund Operating Expenses” are as shown above. Although actual costs    may be higher or lower, based on these assumptions an investor’s cumulative    expenses would be:*

|          |   |
|---------------|--------|
| 1 Year Total  | $96    |
| 3 Year Total  | $298   |
| 5 Year Total  | $518   |
| 10 Year Total | $1,150 |

 

**Investment Objectives****Idaho Tax-Exempt Fund**seeks    to provide income dividends free from Federal income, Federal alternative    minimum and Idaho state income taxes. Preservation of capital is a secondary    objective. 

**Investment Strategies**

 Under normal circumstances, at least 80% of assets are invested in debt securities  generating income exempt from both federal and Idaho income tax.

The Fund requires that at time of purchase a bond be rated at least “A” or  equivalent by a national bond rating agency (Standard and Poor’s, Moody’s  Investor’s Services, or equivalent), or, if non-rated, to be of equivalent  quality in the opinion of the Adviser. 

Up to 60% of total assets of the Fund can be invested in non-rated bonds.  The Adviser will purchase only those non-rated bonds that it believes are  liquid and can be sold at the value consistent with that used for net asset  value purposes.

 

| *March 29, 2006* | *Idaho Tax-Exempt            Fund Prospectus* | *3* |
|------------------|-----------------------------------------------|-----|

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**Risks**

The risks inherent in the Fund depend primarily on the terms and quality  of the obligations in its portfolio, as well as on market conditions. Interest  rate fluctuations affect the Fund’s net asset value, but not the income  received by the Fund from its portfolio securities. Because prices and yields  on debt securities vary over time, the Fund’s yield also varies.

Because the Fund is “non-diversified” and invests primarily in  Idaho municipal securities, its investments are susceptible to factors adversely  affecting Idaho. These factors include economic and financial trends, as well  as political conditions in Idaho and its political subdivisions. Investing  only in Idaho bonds means the Fund is less diversified than some other types  of mutual funds. Concentration in a small area or a small number of security  issues may lead to underperformance compared to investments selected in greater  number and/or from a wider universe.

The Fund entails credit risk, which is the possibility that a bond will not  be able to pay interest or principal when due. If the credit quality of a bond  is perceived to decline, investors will demand a higher yield, which means  a lower price on that bond to compensate for the higher level of risk. If a  security held by the Fund defaults on payment of interest or principal, the  Fund’s income, ability to preserve capital, and liquidity would all  be adversely affected.

Bonds with embedded callable options also contain an element of prepayment  risk. When interest rates decline, issuers can retire their debt and reissue  bonds at a lower interest rate. This hurts investors because yields available  for reinvestment will have declined and upward price mobility on callable bonds  is generally limited by the call price. 

The Fund is vulnerable to tax rate changes, either at the Idaho or Federal  level, since part of municipal securities’ value is derived from the  recipient’s ability to exclude interest payments from taxation. Should  this exclusion be reduced, the market for municipal securities, and consequently  the Fund’s share value, may be adversely affected.

 

**Investment Adviser**

Saturna Capital Corporation, 1300 N. State Street, Bellingham, Washington  98225 is the Investment Adviser and Administrator for the Fund. Saturna Capital’s  wholly owned subsidiary, Saturna Brokerage Services, Inc., is a discount brokerage  firm and acts as distributor for the Fund without compensation. Founded in  1989, Saturna Capital Corporation is also the adviser to Amana Mutual Funds  Trust, the Sextant Mutual Funds and to private accounts. Saturna has approximately  $340 million in assets under management. 

The Fund pays a monthly advisory fee at the annual rate of 0.50% of the average  daily net assets up to $250 million, 0.40% of assets between $250 million  and $1 billion, and 0.30% of assets in excess of $1 billion. For the fiscal  year ended November 30, 2005, the aggregate advisory fee paid was 0.50% of  average net assets. A discussion regarding the basis for the Board’s  approval of the Fund’s advisory contract through September 28, 2006 is  available in the Annual Report to shareholders, available from the Fund on  request.

Phelps McIlvaine, vice president of Saturna Capital since 1994, is the primary  manager of the Idaho Tax-Exempt Fund. He also manages the Sextant Short-Term  Bond Fund and the Sextant Bond Income Fund, other series of the Trust. Additional  information about the portfolio manager, and his Fund ownership and compensation,  is provided in the Statement of Additional Information.

 

**Pricing of Fund Shares**

The Fund computes its net asset value per share each business day by dividing  (i) the value of all of its securities and other assets, less liabilities,  by (ii) the number of shares outstanding. The Fund computes its daily price  at the close of trading on the New York Stock Exchange (generally 4 PM Eastern  time) using market prices. The Fund’s shares are not priced on any customary  national business holiday that security markets are closed. The net asset  value applicable to purchases or redemptions of shares of the Fund is the net  asset value next computed after receipt of a purchase or redemption order.

Since daily bid prices are not available for many municipal bond issues, the  Fund determines fair values for its securities using matrices of municipal  bond yields for various maturities and qualities. Values are adjusted for  factors unique to each bond. To be certain that the process of valuing securities  remains consistent with the markets, the adviser periodically obtains appraisals  from independent sources. Using fair value to price securities may result in  a value that is different from a security’s most recent published price  and from the prices used by other mutual funds to calculate their net asset  values.

**How To Buy Shares**

*IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT: To help    the government fight the funding of terrorism and money laundering activities,    Federal law requires all financial institutions to obtain, verify,*

| *4* | *Idaho Tax-Exempt Fund Prospectus* | *March 29, 2006* |
|-----|------------------------------------|------------------|

----

*and record information that identifies each person who opens an account.    What this means for you: When you open an account, we will ask for your name,    address, date of birth, and other information that will allow us to identify    you. For most accounts, we will ask for a photocopy of your driver’s    license or other identifying documents.*

You may open an account and purchase shares by sending a completed application  with a check for $1,000 or more payable to the Fund. The Fund does not accept  initial orders unaccompanied by payment. The price applicable to purchases  and redemptions of Fund shares is the price next computed after receipt of  a purchase or redemption order by the Fund’s transfer agent (Saturna  Capital), authorized sub transfer agent or retirement plan administrator, or  selling broker-dealer. There are no sales charges or loads. The Fund may reject  purchases for any reason, such as excessive trading or anti-money laundering  regulations which limit acceptance of third-party checks and money orders.

Shareowners may purchase additional shares at any time in minimum amounts  of $25. Once an account is open, purchases can be made by check, by electronic  funds transfer, or by wire. With your authorization, purchase orders can be  entered on-line at www.saturna.com.

Shareowners may authorize the use of electronic funds transfer (via the Automated  Clearing House system [“ACH”]) to purchase or redeem shares by  completing the appropriate section of the application. To use ACH to purchase  or redeem shares, simply call Saturna Capital. Investors also may wire money  to purchase shares, though the wiring bank typically charges a fee for this  service. Be sure Saturna Capital is notified when wiring money.

Each time shares are purchased or redeemed, a confirmation is mailed showing  the details of the transaction as well as the current number and value of shares  held. Share balances are computed in full and fractional shares, expressed  to three decimal places. At the end of each calendar year, you receive a complete  annual statement, which you should retain for tax purposes, and a complete  historical record of all transactions.

Optional plans offered by the Fund include: (1) an automatic investment plan,  (2) a systematic withdrawal plan to provide regular payments to you, and (3)  the right to exchange your shares without charge for any other no-load mutual  fund for which Saturna Capital is the investment adviser. Materials describing  these plans and services may be obtained from Saturna Capital.

Shares may also be purchased and sold through broker-dealers having agreements  with the Fund. These intermediaries may charge investors, and/or require the  adviser/distributor to the Fund to share revenues for their services.

 

**How to Redeem Shares**

Shareowners may redeem all or part of their investment on any business day  of the Fund. The Fund pays redemptions in US dollars, and the amount per share  received is the price next determined after receipt of a redemption request.  The amount paid depends on the value of the investments of the Fund at that  day and may be more or less than the cost of the shares being redeemed.

The Trustees have adopted certain policies and procedures with respect to  frequent trading of Fund shares. The Fund is intended for long-term investment  and does not permit rapid trading of their shares. Rapid trading may lead to  higher portfolio turnover which can increase costs to shareowners and negatively  impact performance. Shares held less than 30 calendar days, including those  held in omnibus accounts at intermediaries, will be assessed a 2% early-redemption  penalty (payable to the Fund).

The Fund normally pays for shares redeemed within three days after a proper  instruction is received. To allow time for clearing, payment for redemption  of investments made by check or ACH may be restricted for up to 14 calendar  days. 

There are several methods you may choose to redeem shares.

***Written request***

> 
Write: 

Idaho Tax-Exempt Fund      Box N      Bellingham WA 98227-0596

Or Fax:	360 / 734-0755

You may redeem shares by a written request and choose one of the following  options for the proceeds:

- Redemption check (no minimum) sent to registered owner(s).
- Redemption check (no minimum) sent as directed if the signature(s) are    guaranteed. If proceeds are to be sent to other than the registered owner(s)    at the last address, the signatures on the request may need to be guaranteed    by a national bank or trust company    or by a member of a national securities exchange.

| *March 29, 2006* | *Idaho Tax-Exempt            Fund Prospectus* | *5* |
|------------------|-----------------------------------------------|-----|

----

- Federal funds wire. The proceeds ($5000 minimum) may be wired to any bank    designated in the request if the signature(s) are guaranteed as explained    above.

***Telephone request***

> 
Call: 

800 / 728-8762 or      360 / 734-9900

Unless you notify us to the contrary in advance, you may redeem shares by  a telephone request and choose one of the following options for the proceeds:

- Redemption check (no minimum) sent to registered owner(s).
- ACH transfer ($100 minimum) with proceeds transferred to your bank account    as designated by the ACH authorization on your application. The transfer    agent must receive the ACH authorization at least two weeks before ACH transfer    can be used.
- Exchange (in at least the minimum established by the Fund being purchased)    for shares of any other Fund for which Saturna Capital is adviser. If the    exchange is your initial investment into this Fund, the new account will    automatically have the same registration as your original account. 
- Federal funds wire. Proceeds ($5000 minimum) may be wired only to the bank    previously designated, or as directed in a prior written instruction with    signatures guaranteed, as explained above.

For telephone requests, the Fund will endeavor to confirm that instructions  are genuine and may be liable for losses if they do not. The caller must provide

- the name of the person making the request, 
- the name and address of the registered owner(s), 
- the account number, 
- the amount to be withdrawn, and 
- the method for payment of the proceeds. 

Generally, signature guarantees are not required. However, the transfer agent  reserves the right to ask for additional documentation relating to the identity  or authority of the party making a request, such as a signature guarantee or  similar information, before completing a transaction. Neither the transfer  agent nor the Fund will not be responsible for the results of transactions  they reasonably believe genuine.

***Check Writing***  Shareowners may also redeem by writing checks for amounts of $500 or more.    Upon request, the Fund provides a small book of blank checks for a $10 fee,    which may then be used to write checks to any payee. Checks are redeemed    at the price next determined after receipt by the transfer agent. To use    this feature, request the Check Writing Privilege on the Application. 

 

**Dividends**

The Fund intends to distribute its net investment income and net realized  capital gains, if any, to its shareowners. The Fund accounts for its distributions  as either taxable capital gains (originating from net realized gains on portfolio  transactions), or taxable income (originating from dividends, taxable interest  and certain other types of gains) or tax-exempt income (originating from interest  on municipal bonds). Income dividends are paid daily and reinvested or distributed  monthly. Distributions from capital gains are paid at the end of November. 

Both dividends and capital gains distributions are automatically reinvested  in additional full and fractional shares of the Fund owned. At your option,  you may receive dividends or capital gain distributions in cash. You are notified  of each dividend and capital gains distribution when paid.

 

**Tax & Investment Information**

Any redemption, including exchanges and checks written by shareowners, constitutes  a sale for federal income tax purposes, and investors may realize a capital  gain or loss on the redemption. 

Each January, the transfer agent reports to each shareowner (consolidated  by taxpayer ID) and to the IRS the amount of each redemption transaction and  the amount of taxable income dividends and capital gains distributions. Dividend  amounts represent the proportionate share the shareowner is to report on a  tax return for the year. Capital gains may be taxed at different rates, depending  on the length of time the Fund held its investments. The Fund expects that  its distribu-

| *6* | *Idaho Tax-Exempt Fund Prospectus* | *March 29, 2006* |
|-----|------------------------------------|------------------|

----

tions will consist primarily of tax-exempt income dividends, but it may invest  a portion of its assets in securities that generate income dividends that are  not exempt from federal or Idaho income tax. Income dividends exempt from federal  tax maybe subject to state and local income. Any capital gains distributed  by the Fund may be taxable. Fund distributions, whether paid in cash or invested  in additional shares of the Fund, may be subject to income taxes.

Shareowners receive financial reports showing investment returns, the portfolio,  income and expenses every six months. Investors may obtain daily share prices  by calling 888/732-6262, on electronic quotation systems (symbol: NITEX), or  by accessing the Internet at www.saturna.com. This prospectus, financial reports,  performance information, and month-end portfolio holdings are also available  at www.saturna.com. 

 

**Financial Highlights**

This table is to help you understand the Fund’s financial performance.  The top section reflects financial results for a single Fund share. The total  returns represent the rate that an investor earned (or lost) on an investment  in the Fund, assuming reinvestment of all dividends and distributions and without  regard to income taxes. Tait Weller & Baker LLP, independent egristered  public accounting firm for the Fund, audited this information. Their report  and the Fund’s   financial statements are in the Fund’s annual report (available free   upon request from Saturna Capital).

|                                                                                 | **Year ended November 30,**                                           |
|--------------------------------------------------------------------------------------|-----------------------------------------------------------------------|
| *Selected data per share of capital stock outstanding throughout          the year:* | **2005**                                                              | **2004** | **2003** | **2002** | **2001** |
| **Net asset value          at beginning of year**                                    | **$5.39**                                                             | **$5.46** | **$5.37** | **$5.28** | **$5.13** |
|                                                                                 | Income from investment operations                                     |  |  |  |  |  |
|                                                                                 | Net investment income                                                 | 0.19 | 0.19 | 0.21 | 0.22 | 0.22 |
|                                                                                 | Net gains (losses) on securities, both realized        and unrealized | (0.10) | (0.07) | 0.09 | 0.09 | 0.15 |
| Total from investment operations                                                     | 0.09                                                                  | 0.12 | 0.30 | 0.31 | 0.37 |
|                                                                                 | *Less distributions*                                                  |  |  |  |  |  |
|                                                                                 | Dividends (from net investment income)                                | (0.19) | (0.19) | (0.21) | (0.22) | (0.22) |
|                                                                                 | Distributions (from capital gains)                                    | (0.02) | - | - | - | - |
| Total distributions                                                                  | (0.21)                                                                | (0.19) | (0.21) | (0.22) | (0.22) |
| Paid in capital from early redemption penalties                                      | *0.00                                                                 | - | - | - | - |
|                                                                                 |                                                                       |  |  |  |  |
| **Net asset value          at end of year**                                          | **$5.27**                                                             | **$5.39** | **$5.46** | **$5.37** | **$5.28** |
| **Total return**                                                                     | **1.66%**                                                             | **2.29%** | **5.40%** | **5.98%** | **7.40%** |
|                                                                                 |                                                                       |  |  |  |  |
| **Ratios/supplemental data**                                                         |                                                                       |  |  |  |  |
| Net assets ($000), end of year                                                       | $8,531                                                                | $8,472 | $7,692 | $6,943 | $6,650 |
| **Raio of expenses to average net assets**                                           |                                                                       |  |  |  |  |
|                                                                                 | Before fee waivers                                                    | 0.91% | 0.95% | 0.88% | 0.88% | 0.90% |
|                                                                                 | After fee waivers                                                     | 0.88% | 0.93% | 0.85% | 0.80% | 0.79% |
| Ratio of net investment income        after waiver to average net assets             | 3.58%                                                                 | 3.56% | 3.78% | 4.14% | 4.21% |
| **Portfolio turnover rate**                                                          | **21%**                                                               | **15%** | **6%** | **11%** | **13%** |
|                                                                                 | **Amount is less than $0.01*                                          |

 

| *March 29, 2006* | *Idaho Tax-Exempt            Fund Prospectus* | *7* |
|------------------|-----------------------------------------------|-----|

----

| **Saturna Capital**      (grpahic omitted) | Mail application and check to:**IDAHO TAX-EXEMPT FUND**      Box N, Bellingham, WA 98227-0596 | For assistance, call:      800/SATURNA or 360/734-9900      FAX 360/734-0755 |
|--------------------------------------------|-----------------------------------------------------------------------------------------------|------------------------------------------------------------------------------|

| **Account Name & Type (select          one):** |
|----------------------------------------------------|
| __ **Individual**                                  | _______________________ | _________ | _______________________ |
|                                               | First Name | Middle Initial | Last Name |
| Social Security Number:                            | __ __ __ - __ __ - __ __ __ __ | Date of birth: |   |
| __ **Joint With**                                  | _______________________ | __________ | _______________________ |
|                                               | First Name | Middle Initial | Last Name |
| Social Security Number:                            | __ __ __ - __ __ - __ __ __ __ | Date of birth: |   |
| __ **Gift To Minor**                               |   | as Custodian for |   |
|                                               | Name of Custodian |   | Name of Minor |
| under the                                          | ________________________ | _____________________ |
|                                               | State | Minor's Social Security & Birthdate |
| __ **Other**                                       | _____________________________________________________________________ |
|                                               | Indicate name of corporation, other organization or fiduciart capacity.      If a trust, include name(s) of trustees and date of trust instruments. | Tax Identification Number | Name(s) of persons authorized to transact business for the      above entity. |

| **Contact Information:** |
|--------------------------|
| **Mailing Address:**     | _________________________________________________________________________ |
|                     | Street | Apt., Suite, Etc. |
|                     |   |
|                     | City | State | Zip |
| **Telephone:**           | Daytime(___) __________ Home(___) __________      Other(___)__________ |
| **Citizenship:**         | __U.S. Citizen __Resident Alien __Non-resident      Alien |

**Initial Investment:** $______________________  Make check payable to the Fund being purchased (minimum $1,000).**Internet Services:**Personal    email address: __________________________________________________________________  Transaction confirmations and shareowner reports may be sent to my e-mail address:  __ Instead of paper mailings (save paper & postage) __ In addition to paper  mailings Please call to establish PIN for internet access to my account.**ACH Telephone Transfer Priviledge:** __To    transfer funds by ACH at no charge to or from my (our) bank account, I (we)    authorize electronic fund transfers through the Automated Clearing House    (ACH) for my (our) bank account designated. Please attach a voided check.**Automatic Investment Plan:** __      Invest $ _______ into this Fund on the _____ day of each month (the 15th      unless another date is chosen) by ACH transfer from my (our) bank account.      This plan may be cancelled at any time. Please attach a voided check.**Check Writing Priviledge:** ($500      per check minimum) ($10 checkbook charge)  __ I (We) hereby request the Custodian to honor checks drawn by me (us) on  my (our) account subject to acceptance by the Funds, with payment to be made  by redeeming sufficient shares in my (our) account. None of the custodian bank,  Saturna Capital Corporation, nor any Sextant Mutual Fund shall incur any liability  to me (us) for honoring such checks, for redeeming shares to pay such checks,  or for returning checks which are not accepted.  __ Single Signature Authority - Joint Accounts only: (Checks for joint accounts  require both signatures unless this box is marked to authorize checks with  a single signature). By our signatures below, we agree to permit check redemptions  upon the single signature of a joint owner. We hereby agree with each other,  with the Funds and with Saturna Capital Corporation that all moneys now or  hereafter invested in our account are and shall be owned as Joint Tenants with  Right of Survivorship, and not as Tenants in Common.

| (graphic omitted)**Identification: You              must establish identity by attaching a photocopy of a driver’s              license, passport or other government-issued document.** |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

The undersigned warrants(s) that I (we) have full authority    to make this Application, am (are) of legal age, and have received and read    a current Prospectus and agree to be bound by its terms. Unless this sentence    is struck, I (we) certify, under penalties of perjury, that I (we) am not    subject to backup withholding under the provisions of section 3406(a)(1)(C)    of the Internal Revenue Code. This application is not effective until it    is received and accepted.

Signature of Individual (or Custodian) __________________________________________  Date ___________________________

  Signature of Joint Registrant (if any) ____________________________________________    Date ___________________________

| Additional information about each Fund’s investments      is available in the Funds’ annual and semi-annual shareowner reports.      The Funds’ annual report includes a discussion of the market conditions      and in-vestment strategies that significantly affected each Fund’s      performance during its last fiscal year. A Statement of Additional Information      contains more details, and is incorporated in this Prospectus by reference.      These documents and other in | formation are available free, upon request, and shareowners      may make inquiries, from:**Saturna Capital Corporation**      1300 N. State St., Bellingham, WA 98225**http://www.saturna.com/**      E-mail: idaho@saturna.com**800-SATURNA** [800-728-8762]      Information about the Funds (including the SAI) can be reviewed and copied      at the SEC’s Public Reference Room in Washington DC | (call 202-942-8090 for information). Reports and other        information about the Funds are also available on the SEC’s EDGAR        database (http://www.sec.gov) and copies may be obtained, upon payment        of a duplicating fee, by writing the Public Reference Section of the        SEC, Washington DC 20549-0102 or sending e-mail to publicinfo@sec.gov. 

Saturna Investment Trust’s Investment Company            Act file number is 811-05071. |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| *8* | *Idaho Tax-Exempt Fund Prospectus* | *March 29, 2006* |
|-----|------------------------------------|------------------|

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**PART B**

 

 

**STATEMENT OF ADDITIONL INFORMATION**

 

 

 

----

  SATURNA INVESTMENT TRUST

**IDAHO TAX-EXEMPT FUND**

1300 N. State Street  Bellingham, Washington 98225

360 / 734-9900  800 / SATURNA

 

STATEMENT OF ADDITIONAL INFORMATION

March 29, 2006

  This Statement of Additional Information is not a Prospectus. It merely furnishes    additional information concerning the Idaho Tax-Exempt Fund that is not included    in the Prospectus. It should be read in conjunction with the Prospectus.    You may obtain a Prospectus dated March 29, 2006 and shareowner Annual and    Semi-Annual reports without charge by writing to the address shown above,    calling toll-free to 888/732-6262, and on the Internet at http://www.saturna.com/.

----

 

| **Table of Contents**

History of the Funds        Fund Descriptions, Investments and Risks         Management of the Funds         Principal Holders of Securities         Investment Advisory and Other Services         Brokerage Allocation         Capital Stock         Purchase, Redemption and Pricing of Shares         Taxation of the Funds         Calculation of Performance Data         Financial Statements | Page

 

3          3          7          8          9          10          10          10          11          11          12 |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------|

 

| 2 | Statement of Additional Information |
|---|-------------------------------------|

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**History of the Fund**

Saturna Investment Trust (the “Trust”) is a business trust formed  pursuant to RCW 23.90 of the laws of the State of Washington to operate as  an open-end management company. When formed on February 20, 1987, the name  was Northwest Investors Tax-Exempt Business Trust. The Trust’s name was  changed to Northwest Investors Trust on October 12, 1990. Most recently, in  connection with the formation of the Sextant Funds, the Trust’s name  was changed to Saturna Investment Trust on September 28, 1995. 

The Trust has five separate Funds, one of which is offered through this Prospectus  and Statement of Additional Information: Idaho Tax-Exempt Fund (commenced operation  September 4, 1987). The other four Sextant Funds are offered through a separate  Prospectus and Statement of Additional Information.

 

**Fund Descriptions, Investments and      Risks**

***Classification***

Saturna Investors Trust is a “series trust” that presently offers  the Idaho Tax-Exempt Fund, an “open-end non-diversified management investment  company” to investors. 

***Investment Strategies and Risks***

The Prospectus describes the principal investment strategies and risks of  those strategies. 

The Fund invests primarily in Idaho municipal bonds. The Fund is “non-diversified.” This  means that with respect to at least 75% of total assets, greater than 5% may  be invested in the securities of any one issuer. The balance of the Fund may  be invested in other securities if not more than 25% of total assets are invested  in the securities of any one issuer, or two or more issuers engaged in the  same or similar trade or business. 

The Adviser may direct investments in other tax-exempt investment companies  which do not concentrate their investments in Idaho Bonds, but nevertheless  yield income which is exempt from both Federal income and alternative minimum  taxation. Such income may be taxable at the state level. It is the policy of  the Fund not to devote more than 5% of its total assets to any one investment  company, nor to devote greater than 10% of its total assets to investments  in investment companies generally. It is anticipated that shares of such investment  companies may be obtained by an affiliated broker/dealer, Saturna Brokerage  Services (the “Distributor”), which has agreed to act as agent  for the Fund and not charge a commission or receive any compensation on purchases  of securities made on behalf of the Fund. The purchase of securities of other  investment companies may result in the Fund’s shareowners paying investment  advisory fees twice on the same assets.

**Non-Rated Bonds.** Adviser believes that many of the debt securities  issued by the State of Idaho or the political subdivisions, agencies or instrumentalities  thereunder are small issues in total dollars, and are typically issued by smaller  communities or instrumentalities to obtain capital. Because of the small size  of such issues, the expense of obtaining a rating for the issued obligation  (the “Bond”) is typically not undertaken. Without a rating, investors  must rely solely on their own analysis and investigation to determine investment  risk and worth of such Bonds. Since the cost of such analysis and investigation  is typically not considered warranted due to the size of such issues, despite  a higher return typically available from such non-rated Bonds, issues of non-rated  Bonds generally do not have a trading market consisting of as many dealers  as comparable rated issuers. Occasionally, the financial institution lending  the funds to a municipality receives the Bond and holds it until maturity.  As a result, although trading markets exist for non-rated Bonds, generally  the number of dealers participating in the market are fewer than that which  exists for rated Bonds. Although all rated and non-rated Bonds are traded on  the basis of dealers’ perception of credit-worthiness, a non-rated Bond  having greater recognition among dealers will have a market consisting of a  greater number of dealers than will the market for a Bond not having as great  a recognition. The Adviser anticipates that investment in non-rated Bonds will  occur only when the Adviser believes the credit of the issuer of such non-rated  Bonds is such so as to warrant an investment without unreasonable risk to the  preservation of capital and which is sufficiently recognized among the market  dealers so as to provide ready marketability of the investment. In the opinion  of the Adviser, such non-rated Bonds will be comparable to rated Bonds having  an “A” rating. Experience of the Adviser indicates that investments  in certain good quality non-rated Bonds are liquid and can be sold within a  day at or near the value given for computing net asset value.

The Adviser believes that there exist both rated and non-rated Bonds that  constitute good investments that will promote the investment objectives of  the Fund. Purchases of Bonds on behalf of the Fund may be made directly from  the issuer. Some purchases are by sealed bid, with the entire issue being awarded  to the lowest interest rate that is bid. Most issuers are willing to negotiate  a rate directly with the managing underwriter and/or purchaser. In this instance,  the Adviser will deal in good faith to arrive at a competitive rate.

In contemplating the rate at which to bid a Bond, the Adviser may consider  the opinions and evaluations of independent broker/dealers specializing in  Idaho municipal bonds. Such brokers may also be requested to render their opinions  as to the value of the Fund’s investment securities portfolio, including  rated and non-rated Bonds. The Adviser may consider such evaluations and valuation  services provided by such independent brokers in determining where it effects  transactions in investment securities.

| Statement of Additional          Information | 3 |
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**Investments.** The Fund invests at least 40% of total assets  in municipal securities rated “A” or better by Moody’s Investors  Service, Inc. (“Moody’s”) or Standard and Poor’s (“S&P”).  The Fund invests more heavily in rated Bonds for various purposes, including  (a) diversification or greater liquidity, (b) when the difference in returns  between rated and non-rated Bonds is not material, or (c) when interest rates  are expected to increase. 

Under normal circumstances the Fund may invest up to 60% of total assets in  non-rated Bonds only when the Adviser believes the credit of the issuer warrants  an investment without unreasonable risk to the preservation of capital and  the Bonds are sufficiently recognized among the market dealers so as to provide  the ready marketability of the investment. The Fund employs the services of  independent broker/dealers specializing in municipal bonds to assist the Adviser  in both (1) determining the purchase price of rated and non-rated Bonds and  (2) valuing the rated and non-rated Bonds for net asset value computation  purposes. 

In evaluating Bonds, the Adviser analyzes the extent of investment risk by  policies that include:

The extent of unemployment within the assessment district for the issuer      of a Bond and the extent to which this may affect repayment of the Bond      at maturity;
 The extent to which the real property within the assessment district      is owned by a small number of persons or entities and the relative economic      strength of such persons or entities which may affect repayment of the      Bond at maturity;
The financial position of the political subdivision, including, but not      limited to, the extent of its existing indebtedness.

These limitations and policies are considered primarily at the time of purchase.  The sale of a Bond is not mandated in the event of a subsequent change in circumstances.  Indeed, Bonds are commonly held until maturity, when the Bond will be redeemed  for its full face value, assuming no defaults. Nonetheless, both rated and  non-rated Bonds may be sold prior to maturity for various purposes, such as  a desire for greater liquidity or to preserve capital. 

The Fund invests predominantly in municipal obligations issued by the State  of Idaho or any political subdivision, agency or instrumentality thereof (“Municipality”).  These municipal obligations generally include Municipal bonds, Municipal notes,  Municipal commercial paper, and any other obligation from which the payment  of interest, in the opinion of the bond issuer’s counsel, is exempt from  Federal and Idaho State income tax. A general description of these investments  is:

Municipal bonds are debt obligations issued to obtain funds for various  public purposes such as construction of public facilities (e.g., airports,  highways, bridges, and schools). Maturities of municipal bonds at the time  of issuance may range from one year to 30 years or more.

Municipal notes are short-term obligations of municipalities, generally  with a maturity ranging from six months to three years. The principal types  of notes include tax, bond, and revenue anticipation notes and project notes.

Municipal commercial paper refers to short-term obligations of municipalities,  which may be issued at a discount. Such paper is likely to be issued to meet  seasonal working capital needs of the Municipality or interim construction  financing. Municipal commercial paper is, in most cases, backed by letters  of credit, lending agreements, note repurchase agreements, or other credit  facility agreements offered by banks and other institutions.

Municipal notes and commercial paper obligations are usually issued in the  following circumstances: (a) When borrowing is in anticipation of long-term  financing, the paper is generally referred to as bond anticipation notes (“BAN”).  Cities are authorized to issue revenue bond anticipation notes. The maturity  date cannot exceed five years from the date of issue. Payment can be extended  for not more than three years from their maturity date. BANs are secured by  income and revenues derived by the city from the project and from the sale  of the revenue bonds in anticipation of which the notes are issued. (b) Borrowings  to level temporary shortfalls in revenue occasioned by irregular receipts of  taxes are generally referred to as tax anticipation notes (“TAN”).  Taxing districts, including counties, any political subdivision of the state,  any municipal corporation, school districts, any quasi-municipal corporation  or any other public corporation authorized to levy taxes, are authorized to  borrow money and issue a TAN. The TANs must mature no longer than one year  from the date of issue and are issued in anticipation of collection of taxes  in the current fiscal year. The taxing district is limited to an amount equal  to 75% of the taxes levied in the current fiscal year and not yet collected.  The full faith and credit of the taxing districts back TANs. The State of Idaho  is also authorized to issue a TAN in anticipation of income or revenue from  taxes, but is forbidden by its constitution to engage in deficit spending or  long-term borrowing. The term of the obligation is the shorter of 12 months  or to the end of the fiscal year. Likewise, the borrowed amount cannot exceed  75% of the income or revenue from taxes which the State tax commission or other  tax collection agency certifies is reasonably anticipated to be collected during  the current fiscal year.

Municipal bonds include debt obligations issued to obtain funds for various  public purposes, including the construction of public facilities. Municipal  bonds may be used to refund outstanding obligations, to obtain funds for general  operating expenses, or for lending public or private institutions funds for  the construction of educational facilities, hospitals, or housing, or for other  public purposes. The two principal classifications of municipal bonds are general  obligation and limited obligation (or revenue) bonds. Limited project bonds  are known as local improvement district (“LID”) bonds.

General obligation bonds (“GO Bonds”) are those obligations  of an issuer to which the full faith and credit of the municipality is pledged.  The proceeds from GO Bonds are used for a wide variety of public uses, including,  but not limited to, public facilities such as the structure or improvement  of schools, highways, and roads, water and sewer systems, and facilities for  a variety of public pur-

| 4 | Statement of Additional Information |
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poses. A GO Bond is paid from ad valorem property taxes or from other tax  sources. Many types of obligations may be general obligations of a municipality  whether or not they are incurred through the issuance of bonds. GO Bonds may  be incurred in the form of a registered warrant, conditional sales contract,  or other instrument in which an unconditional and unlimited promise to pay  from ad valorem taxes is made. 

Revenue bonds may be issued to fund a wide variety of revenue-producing  capital projects including, but not limited to, electric, gas, water and sewer  systems, highways, bridges, and tunnels, airport facilities, colleges and universities,  hospitals, and health, convention, recreational, and housing facilities. Although  the principal security of these bonds varies, generally, revenue bonds are  payable from a debt service reserve fund, the cash for which is derived from  the operation of the particular utility or enterprise. Revenue bonds are not  general obligations. The revenues of the particular utility or system secure  them. They can be issued by agencies of a state and can also be issued by political  subdivisions including counties, cities, towns, water districts, sewer districts,  irrigation districts, port districts, and housing authorities.

The Fund will invest in revenue bonds with a coverage factor between net revenue  to the annual debt service of a minimum of 1 to 1.25. Only issues that have  a debt service reserve fund balance equal to the average annual debt service  will be purchased. 

Local Improvement District (“LID”) bonds are  secured by assessments levied against the properties benefited by the improvements  constructed with  the proceeds of the bonds. This type of financing is available to counties,  water and/or sewer districts, highway districts, irrigation districts and  cities. The property must be specially benefited by the improvements constructed  out of the proceeds of the bonds, generally within a local improvement district.

Private Activity Bonds, including Industrial Development Bonds (“IDB”),  are commonly issued by public authorities but generally are not secured by  any taxing power. Rather, they are secured by the revenues derived from the  lease or rental payments received from the industrial user, and the credit  quality of such Municipal Bonds is usually directly related to the credit standing  of the user of the facilities. Since 1986 there have been substantial limitations  on new issues of municipal bonds to finance privately operated facilities.  To the extent such municipal bonds would generate income that might be taxed  under federal alternative minimum tax provisions, the Fund does not invest  in Private Activity bonds. The Fund does not anticipate that greater than  5% of the Fund’s total assets will be invested in Private Activity Bonds.

The Fund may purchase certain variable or floating rate obligations in which  the interest rate is adjusted at predesignated periodic intervals (variable  rate) or when there is a change in the market rate of interest on which the  interest rate payable on the obligation is based (floating rate). Variable  or floating rate obligations may include a demand feature that entitles the  purchaser to demand prepayment of the principal amount prior to stated maturity.  Also, the issuer may have a corresponding right to prepay the principal amount  prior to maturity.

Many factors may cause the value of a shareholder’s investment in the  Fund to fluctuate in value. The value of the Fund’s portfolio will normally  fluctuate inversely with changes in market interest rates. Generally, when  market interest rates rise, the price of municipal bonds held in the Fund will  fall; when rates fall, the price of such bonds will generally rise. In addition,  there is a risk that the issuer of a municipal bond or other security will  fail to make timely payments of principal and interest. Interest rate fluctuations  will affect the Fund’s net asset value, but not the income received by  the Fund from its portfolio securities. However, because yields on debt securities  available for purchase by the Fund vary over time, no specific yield on shares  of the Fund can be assured.

Because the Fund concentrates its investments in a single state, there is  a greater risk of fluctuation in the values of its portfolio securities than  with mutual funds, the investments of which are more geographically diverse.  Investors should carefully consider the investment risks of such concentration.  The Fund’s share prices can be affected by political and economic developments  within and by the financial condition of the State of Idaho, its public authorities  and political subdivisions. 

***Fund Policies***

Investment objectives and certain policies of the Fund may not be changed  without the prior approval of the holders of the majority of the outstanding  shares of the Fund. Objectives and policies which are considered fundamental  and subject to change only by prior approval of the shareowners include: (1)  the primary and secondary investment objectives; (2) the 80% of assets minimum  investment in Idaho tax-exempt income securities; (3) the classification of  the Fund as an open-end management company and the sub-classification of the  Fund as a non-diversified company; and (4) the policies listed under “Investment  Restrictions.” 

***Investment Restrictions***

The Fund shall not purchase securities on margin or sell securities short  or purchase or write put or call options; purchase “restricted securities” (those  which are subject to legal or contractual restrictions on resale or are otherwise  not readily marketable); nor invest in oil, gas or other mineral exploration  leases and programs. The Fund shall not make loans to others, except for the  purchase of debt securities, or enter into repurchase agreements. The Fund  shall not invest in securities so as to not comply with Subchapter M of the  Internal Revenue Code, in that generally at the close of each quarter of the  tax year, at least 50% of the value of each Fund’s total assets is represented  by (i) cash and cash items, government securities, and securities of other  regulated invest-ment companies, and (ii) other securities, except that with  respect to any one issuer in an amount more than 5% of ei-ther Fund’s  total assets, and no more than 10% of the Fund’s voting securities of  any one issuer. In addition, the Fund shall not purchase real estate; real  estate limited partnerships; commodities or commodity contracts; issue senior  securities; provided, however, that a fund may borrow money 

| Statement of Additional          Information | 5 |
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for extraordinary or emergency purposes and then only if after such borrowing  there is asset coverage of at least 300% for all such borrowings; nor act as  a securities underwriter except that they may purchase securities directly  from the issuer for investment purposes. Also, the Fund shall not purchase  or retain securities of any issuer if the officers or trustees of the Fund  or its Adviser own more than one-half of one percent of the securities of such  issuer; invest in any company for the purpose of management or exercising  control. The Fund shall not purchase securities of any issuer in excess of  5% of the Fund’s total assets or purchase more than 10% of the outstanding  voting securities of any issuer; or concentrate its investments in a single  industry beyond 25% of the total value of the Fund; or invest more than 10%  of its assets in the securities of issuers which together have a record of  less than three years continuous operation. 

***Temporary Defensive Position***

During uncertain market or economic conditions, the Idaho Tax-Exempt Fund  may adopt a temporary defensive position and invest more than 20% of assets  in cash or equivalents, government securities, unaffiliated money-market  mutual funds, and other debt securities having an “A” rating or  better. While such defensive investments may not contribute to the primary  objective of tax-free income, they do assist the secondary objective of capital  preservation.

***Portfolio Turnover***

The Fund places no restrictions on portfolio turnover and the Fund will buy  or sell investments according to the Adviser’s appraisal of the factors  affecting the market and the economy. The Adviser does not anticipate significant  variation from the relatively low portfolio turnover rates experienced in the  past.

***Portfolio Information***

The Fund publishes its complete portfolio holdings on the Internet after each  month-end (http://www.saturna.com). It publishes annual and semi-annual reports  containing portfolio holdings. It files periodic reports with the SEC containing  portfolio holdings, which may be published on the Internet. The Fund may provide  dealers, financial services and reporters with month-end portfolio holdings.  The Fund does not disclose mid-month portfolio holdings. Information about  open trades, strategies, and investment programs is proprietary information  of the Adviser and kept confidential. 

| 6 | Statement of Additional Information |
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**Management of the Fund**

***Board of Trustees***

A Board of five Trustees manages the Fund: Nicholas Kaiser, John E. Love,  John S. Moore, Gary A. Goldfogel, and Herbert G. Grubel. The Trustees establish  policies, as well as review and approve contracts and their continuance. The  Trustees also elect the officers, determine the amount of any dividend or  capital gain distribution and serve on any committees of the Trust. The majority  of Trustees are Independent, having no relationship with the Adviser or its  affiliates, and solely consider the interests of shareowners.

***Management Information***

Starting with the Independent Trustees, the Trustees and officers are:

| (1)        Name, Address and Age                                                                                 | (2)        Position(s)         Held with Trust                      | (3)        Principal Occupation(s) during past 5 years                                                                                                                 | (4)        Dollar Range of Securities in the Fund | Number of Portfolios in Saturna fund        complex overseen by Trustee | Other Directorships held by Trustee |
|------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------|-------------------------------------------------------------------------|-------------------------------------|
| **INDEPENDENT TRUSTEES**                                                                                         |
| John E. Love      1002 Spokane Street      Garfield WA 99130      Age: 73                                        | Independent Trustee        since 1987;        Independent Chairman  | Owner, J.E. Love Co., (agricultural equipment manufacturer)                                                                                                            | None                                              | Five                                                                    | None                                |
| John S. Moore, Ph.D.      346 Bayside Road      Bellingham WA 98225      Age: 74                                 | Independent Trustee        since 1993;        Audit Committee Chair | Professor (retired), College of Business and Economics,        Western Washington University                                                                           | None                                              | Five                                                                    | None                                |
| Gary A. Goldfogel, M.D.      1500 N. State Street      Bellingham WA 98226      Age: 47                          | Independent Trustee        since 1995                               | Medical Examiner (pathologist).        Owner, Avocet Environmental Testing (laboratory)                                                                                | None                                              | Five                                                                    | None                                |
| Herbert G. Grubel      Apt. 1202 - 125 West Second St.      North Vancouver, BC      Canada V7M 1C5      Age: 71 | Independent Trustee        since 2005                               | Senior Fellow, Fraser Institute;        Professor (Emeritus) of Economics, Simon Fraser University;        Author                                                      | None                                              | Five                                                                    | None                                |
| **INTERESTED TRUSTEE**                                                                                           |
| Nicholas F. Kaiser, MBA*      1300 N. State Street      Bellingham WA 98225      Age: 59                         | President and Trustee since 1990                                    | President, Saturna Capital Corporation (the Trust’s        investment adviser)        President, Saturna Brokerage Services (the Trust’s distributor)      | $1-$10,000                                        | Seven                                                                   | Amana Mutual Funds Trust            |
| **OFFICERS WHO ARE NOT TRUSTEES**                                                                                |
| Phelps S. McIlvaine*      1300 N. State Street      Bellingham WA 98225      Age: 52                             | Vice President        since 1994                                    | Vice President, Saturna Capital Corporation (the Trust’s        investment adviser)        Treasurer, Saturna Brokerage Services (the Trust’s distributor) | None                                              | N/A                                                                     | N/A                                 |
| Ethel B. Bartolome*      1300 N. State Street      Bellingham WA 98225      Age: 33                              | Secretary        since 2001                                         | Corporate Administrator, Saturna Capital Corporation        (the Trust’s investment adviser)                                                                     | None                                              | N/A                                                                     | N/A                                 |
| Christopher R. Fankhauser*      1300 N. State Street      Bellingham WA 98225      Age: 33                       | Treasurer        since 2002                                         | Chief Operating Officer, Saturna Capital Corporation        (the Trust’s investment adviser)                                                                     | None                                              | N/A                                                                     | N/A                                 |
| James D. Winship, Esq.*      5406 Diamond Place NE      Bainbridge Island, WA 98110      Age: 57                 | Chief Compliance Officer        since 2004                          | Attorney        Adjunct of Professor, University of Washington and Seattle Pacific University                                                                          | None                                              | N/A                                                                     | N/A                                 |

*Messrs. Kaiser, McIlvaine, Fankhauser and Winship, and Mrs. Bartolome are “interested  persons” of the Trust as employees of the Adviser, Saturna Capital Corporation.  Messrs. Kaiser, Fankhauser and Winship, and Mrs. Bartolome hold the same positions  with Amana Mutual Funds Trust, which has two Fund portfolios, and is also managed  by Saturna Capital Corporation. 

Mr. Kaiser is the only trustee with holdings in other Registered InvestmentCompanies in the Saturna family, and their aggregate value exceeds $100,000.

The Board has authority to establish an Executive Committee with the power  to act on behalf of the Board between meetings and to exercise all powers of  the Trustees in the management of the Trust. No Executive Committee has been  established at this time. An Audit 

| Statement of Additional          Information | 7 |
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Committee operating under a specific charter and consisting of the disinterested  directors meets to select the independent registered public accounting firm  and review all audit reports. The audit committee held one meeting during the  fiscal year. A separate nominating committee, consisting of the disinterested  directors, met once during the fiscal year. The nominating committee will considershareowners for nomination who submit their written qualifications to the Secretary.

***Compensation***

Effective December 2005, the Trust pays disinterested trustees $300 per meeting  attended, plus reimbursement of travel ex-penses (pro-rata to each Fund of  the Trust). Mr. Kaiser receives no compensation from the Trust, nor are the  other officers of the Trust paid for their duties with the Trust; except that  Mr. Winship has been retained by the Trust as Chief Compliance Officer, for  which he is compensated. The following table provides the total compensation  paid trustees for the fiscal year ended November 30, 2005.

| Name of Person;      Position                       | Aggregate Compensation from Trust | Pension or Retirement Benefits Accrued        as Part of Trust Expenses | Estimated Annual Benefits Upon Retirement | Total Compensation From Trust and Fund        Complex Paid to Trustees |
|-----------------------------------------------------|-----------------------------------|-------------------------------------------------------------------------|-------------------------------------------|------------------------------------------------------------------------|
| John E. Love      Trustee, Chairman                 | $1000                             | $0                                                                      | $0                                        | $1000                                                                  |
| John S. Moore      Trustee                          | $1000                             | $0                                                                      | $0                                        | $1000                                                                  |
| Gary A. Goldfogel      Trustee                      | $1000                             | $0                                                                      | $0                                        | $1000                                                                  |
| Herbert A. Ershig      Trustee (retired Sept. 2005) | $600                              | $0                                                                      | $0                                        | $600                                                                   |
| Herbert G. Grubel      Trustee (new Dec. 2005)      | $0                                | $0                                                                      | $0                                        | $0                                                                     |
| Nicholas F. Kaiser      Trustee                     | $0                                | $0                                                                      | $0                                        | $0                                                                     |

***Code of Ethics***

The Trust, its investment advisor Saturna Capital Corporation, and its principal  underwriter Saturna Brokerage Services, have adopted a common Code of Ethics  under Rule 17j-1 of the Investment Company Act and Rule 204a-1 of the Investment  Advisers Act. The Code permits personnel subject to the Code (as defined in  the Code) to invest in securities, including common stocks and mutual funds.  To prevent conflicts of interest, the Code includes restrictions on the investing  in common stocks that may be purchased by the Funds. A copy of the Code is  available without charge by contacting the Trust or Saturna Capital Corporation.

 

**Principal Holders of Securities**

As of March 1, 2006, the principal holder of record (those with more than  5% of the outstanding shares) was:

|                                                                                        | Name and Address                                                                                       | Shares  | Percentage |
|---------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------|---------|------------|
| **Idaho Tax-Exempt Fund**                                                                   | National Investor Service Corp.      Omnibus Account      55 Water Street      New York, NY 10041-3299 | 238,286 | 14.68%     |
| Robert Kitzinger      690 E. Kingsford Drive      Meridian, ID 83642                        | 87,730                                                                                                 | 5.40%   |
| O. Richard Barker      Orma H. Barker JT WROS      177 E. Fir Street      Shelley, ID 83274 | 85,944                                                                                                 | 5.29%   |

The officers and Trustees (plus affiliated family members and entities), as  a group, owned 808 shares of Idaho Tax-Exempt Fund (0.05%). 

| 8 | Statement of Additional Information |
|---|-------------------------------------|

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**Investment Advisory and Other Services**

***Investment Adviser and Administrator***

Saturna Capital Corporation, 1300 N. State Street, Bellingham, Washington  98225, is the Investment Adviser and Administrator (the “Adviser”)  for the Fund. Saturna Capital is also the Fund’s shareowner servicing  agent. Mr. Nicholas Kaiser, by his ownership of the majority of its voting  stock, is the controlling person of the Adviser. Mr. Phelps McIlvaine is the  principal portfolio manager of the Idaho Tax-Exempt Fund, and a shareowner  and member of the board of the Adviser. 

A discussion of the trustees’ approval of the continuance of the investment  advisory and administration agreements is available in the Trust’s November  30, 2005 annual report. 

***Advisory Fee***

The Fund is obligated to pay Saturna Capital monthly an advisory fee at the  annual rate of 0.50% of the average daily net assets up to $250 million, 0.40%  of assets between $250 million and $1 billion, and .30% of assets in excess  of $1 billion.   For each of the fiscal years ended November 30, 2003, 2004 and 2005, respectively,  the advisory fees (after expense limitations) the Fund paid Saturna Capital  were $36,578, $39,632 and $42,315, respectively. A discussion regarding the  basis for the board of directors approving the investment advisory contract  of the Fund is available in the Fund’s annual or semi-annual report to  shareholders, as applicable, and providing the period covered by the relevant  annual or semi-annual report.

***Portfolio Managers***

| Portfolio Manager:                                                                | **Nicholas Kaiser**                                                                                             | **Phelps McIlVaine**                                                                                               |
|-----------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------|
| Trust portfolios served as primary manager        and manager's ownership (range) | Sextant Growth Fund        Sextant International Fund        (11/30/2005 assets of $100,000-500,000, each Fund) | Sextant Bond Income Fund        Sextant Short-Term Bond Fund        Idaho Tax-Exempt Fund        (none, all Funds) |
| Other investment company portfolios served        as primary manager:             | Amana Growth Fund        Amana Income Fund        (11/30/2005 assets of $169 million)                           | None                                                                                                               |
| Other pooled investment vehicles served        as primary manager:                | Two        (12/31/2005 assets of $13 million, which are all managed with a performance            fee)          | None                                                                                                               |
| Other accounts:                                                                   | Twenty-eight        (12/31/2005 assets of $17 million)                                                          | One        (12/31/2005 assets of $3 million)                                                                       |

All Saturna Capital employees, including Nicholas Kaiser, Phelps McIlvaine  and other portfolio managers, are paid an annual salary, as set by the board  of Saturna Capital. The board also pays bonuses, that are partly dependent  on the profits of Saturna Capital and may also reflect the results of specific  managed accounts or specific businesses of Saturna Capital. As shareowners  of Saturna Capital Corporation, Messrs. Kaiser and McIlvaine may benefit from  any increase in its value per share that might result from its operations or  profits. All Saturna Capital employees are eligible for a retirement plan,  health and other benefits, and a stock option plan. Stock options are annually  awarded on the basis of years of service, and not individual performance. Mutual  fund portfolio managers are paid a monthly bonus (which may be shared with  other employees) when a fund achieves an overall rating of 4 or 5 stars from  Morningstar. The bonus is 1% of the adviser’s net monthly fee (which  is based on both assets and performance) for a 4-star rating, and 2% of the  monthly fee for a 5-star rating. Mr. Nicholas Kaiser was paid a total of $81,360  in compensation by Saturna Capital in calendar 2005. Mr. Phelps McIlvaine was  paid a total of $63,978 in calendar 2005.

The Adviser has adopted a Code of Ethics which governs trading by portfolio  managers to avoid conflicts of interest. To avoid any single managed account  of the Adviser getting a trading advantage, portfolio transactions are done  as a “bunched” order then allocated pro-rata to individual accounts.

***Shareowner Services***

Saturna Capital also provides services as the transfer agent and dividend-paying  agent for the Fund. As transfer agent, Saturna furnishes to each shareowner  a statement after each transaction, an historical statement at the end of each  year showing all transactions during the year, and any Form 1099 tax forms.  Saturna also, on behalf of the Fund, responds to shareowners’ questions  or correspondence. Further, the transfer agent regularly furnishes the Fund  with current shareowner lists and information necessary to keep the shares  in balance with the Fund’s records. The transfer agent performs the mailing  of financial statements, notices and prospectuses to shareowners. 

For each of the fiscal years ended November 30, 2003, 2004 and 2005, respectively,  the shareowner servicing fees (after expense limitations) the Fund paid Saturna  Capital were $4,250, $4,141 and $4,150, respectively. 

| Statement of Additional          Information | 9 |
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***Custodian***

National City Bank, Indiana, of Indianapolis, National City Center, Indianapolis,  Indiana 46255 is the custodian of the Funds. As custodian for the Fund, the  bank holds in custody all securities and cash, settles for all securities transactions,  receives money from sale of shares and on order of the Fund pays the authorized  expenses of the Fund. When investors redeem Fund shares, the proceeds are  paid to the shareowner from an account at the custodian bank.

***Independent Registered Public Accounting Firm***

Tait, Weller and Baker LLP, 1818 Market Street, Suite 2400, Philadelphia,  PA 19103 are the independent registered public accounting firm for the Fund.  The accountants  conduct an annual audit of the Fund as of November 30 each year, prepare the  tax returns of the Fund and assist the Adviser in any accounting matters throughout  the year.

***Principal Underwriter***

The Adviser’s wholly-owned subsidiary, Saturna Brokerage Services, Inc.,  1300 N. State Street, Bellingham WA 98225 is a discount brokerage firm and  acts as distributor for the Fund without compensation. Mr. Nicholas Kaiser,  an affiliated person of the Fund, is President of Saturna Brokerage Services,  Inc.

 

**Brokerage Allocation**

For fiscal years 2003, 2004, and 2005, Idaho Tax-Exempt Fund paid no brokerage  commissions. 

The placing of purchase and sale orders as well as the negotiation of commissions,  if any, is performed by the Adviser and is reviewed by the Board of Trustees.  The Adviser may make allocation of brokerage to any broker in return for research  or services and for selling shares of the Fund. Brokers may provide research  or statistical material to the Adviser, but this information is only supplemental  to the research and other statistics and material accumulated and maintained  through the Adviser’s own efforts. Any such supplemental information  may or may not be of value or used in making investment decisions for the Fund  or any other account serviced by the Adviser. Research services provided by  brokers through whom the Fund effects securities transactions may be used by  the Fund’s investment adviser in servicing all of its accounts and not  all of these services may be used by the adviser in connection with the Fund.

The primary consideration in effecting securities transactions for the Fund  is to obtain the best price and execution which in the judgment of the Adviser  is attainable at the time and which would bring the best net overall economic  result to the Fund. Factors taken into account in the selection of brokers  include the price of the security, commissions paid on the transaction, the  efficiency and cooperation with which the transaction is effected, the expediency  of making settlement and the financial strength and stability of the broker.  The Adviser may negotiate commissions at a rate in excess of the amount another  broker would have charged if it determines in good faith that the overall net  economic result is favorable to the Fund, and is not required to execute trades  in “over-the-counter” securities with primary market-makers if  similar terms are available elsewhere. The Adviser evaluates whether brokerage  commissions are reasonable based upon available information about the general  level of commissions paid by similar mutual funds for comparable services.

 

**Capital Stock**

Each Fund of Saturna Investment Trust is divided into shares of beneficial  interest. The shares of each separate Fund of the Trust have equal voting rights.  All shares are fully paid, non-assessable, transferable and with rights of  redemption, and are not subject to preemptive rights. The Trust is not required  to hold annual shareowner meetings. However, special meetings may be called  for such purposes as electing or removing Trustees, changing fundamental policies,  or voting on approval of an advisory contract. On issues relating solely to  Idaho Tax-Exempt Fund, only the shareowners of Idaho Tax-Exempt Fund are entitled  to vote. All dividends and distributions for the Fund shall be distributed  to shareowners in proportion to the number of shares owned.

 

**Purchase, Redemption and Pricing of      Shares**

See *How to Buy Shares, How to Redeem Shares* and *Pricing of Fund    Shares* in  the Prospectus for an explanation about the ways to purchase or redeem shares.  Both purchases and redemptions are made at net asset value per share. A 2%  penalty may apply to early redemptions.

In addition to normal purchases or redemptions, the shares of the Fund may  be exchanged for shares of other funds managed by Saturna Capital. Exchanges  will be made at no charge upon written request or by telephone if the shareowner  has previously authorized telephone privileges. A gain or loss for federal  tax purposes will be realized upon redemption of any shares for the purposes  of an exchange as described above.

Price (net asset value) per share is determined by dividing the value of all  securities and other assets, less liabilities, by the number of shares outstanding.  The daily price is determined for each Fund as of the close of trading on the  New York Stock Exchange (generally 4 p.m. New York time) on each day the Exchange  is open for trading. The Exchange is generally closed on New Year’s Day,  Martin Luther King Day, President’s Day, Good Friday, Memorial Day, Independence  Day, Labor Day, Thanksgiving and Christmas. 

| 10 | Statement of Additional Information |
|----|-------------------------------------|

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**Taxation of the Fund**

Saturna Investment Trust is organized as a “series” investment  company. As one of the funds in the Trust, Idaho Tax-Exempt Fund is a separate  eco-nomic entity with separate assets and liabilities and separate income streams.  The shareowners of the Fund may look only to the Fund for income, capital gain  or loss, redemption, liquidation, or termination. The Fund has separate arrangements  with the Adviser. Assets of the Fund are segregated. The creditors and shareowners  of the Fund are limited to the assets of the Fund for recovery of charges,  expenses and liabilities. The Fund conducts separate voting on issues relating  solely to the Fund, except as required by the Investment Company Act. The tax  status and tax consequences to shareowners of the Fund differ, depending upon  the investment objectives, operations, income, gain or loss, and distributions  from the Fund.

The Fund intends to distribute to shareowners substantially all of its net  investment income and net realized capital gains, if any, and to comply, as  it has since inception, with the provisions of the Internal Revenue Code applicable  to regulated investment companies (Subchapter M), which relieve mutual funds  of federal income taxes on the amounts so distributed. 

Interest received upon the obligations of the State of Idaho or political  subdivisions thereof are exempt from income tax in the State of Idaho. An Idaho  Income Tax ruling provides a pass-through of the tax-exempt character of interest  received by a regulated investment company, such as the Idaho Tax-Exempt Fund,  upon distribution to shareholders.

If shareowners do not furnish the transfer agent with a valid Social Security  or Tax Identification Number and in certain other circumstances, the transfer  agent is required to with-hold 28% of taxable income dividends. If the IRS  determines that the Fund should be fined or penalized for inaccurate or missing  or otherwise inadequate reporting of a Tax Identification Number, the amount  of the IRS fee or penalty will be directly assessed to the shareowner account  involved.

 

**Calculation of Performance Data**

Average annual Total Return and Current Yield information may be useful to  investors in reviewing a Fund’s performance. However, certain factors  should be taken into account before using the information as a basis for comparison  with alternative investments. Additional calculations are made to illustrate  possible taxes payable on distributions and sale of shares. The performance  for any given past period is not an indication of future rates of return or  yield on its shares. 

**Annual Average Total Return (before taxes)** for the Idaho  Tax-Exempt Fund for one year from November 30, 2004 through November 30, 2005  was 1.66%. Average annual total return for the five years ended November 30,  2005 was 4.56%. Average annual total return for the ten years ended November  30, 2005 was 4.52%. 

Average annual Total Return (before taxes) quotations for various periods  illustrated are computed by finding the average annual compounded rate of return  over the period quoted that would equate the initial amount invested to the  ending redeemable value according to the following formula:

P (l + T)*n* = ERV

Where	P = a hypothetical initial Payment of $1,000  T = average annual Total return  n = number of years  ERV = Ending Redeemable Value of the $1,000 payment made at the beginning of  the period.

To solve for average Total Return, the formula is as follows:

T = ( ERV/P)1/n - 1

**Average Annual Total Return (after taxes on distributions)** for  the Idaho Tax-Exempt Fund for one year from November 30, 2004 through November  30, 2005 was 1.59%. Average annual total return for the five years ended November  30, 2005 was 4.55%. Average annual total return for the ten years ended November  30, 2005 was 4.50%. 

Average annual Total Return (after taxes on distributions) quotations for  various periods illustrated are computed by finding the average annual compounded  rate of return over the period quoted that would equate the initial amount  invested to the ending redeemable value according to the following formula:

P (l + T)*n*= ATVD

Where	P = a hypothetical initial Payment of $1,000  T = average annual Total return (after any federal income taxes on distributions)  n = number of years  ATVD = Ending Value of the hypothetical $1,000 payment made at the beginning  of the period after taxes on fund distributions but not after any federal income  taxes on redemption

 

| Statement of Additional          Information | 11 |
|----------------------------------------------|----|

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**Average Annual Total Return**(after taxes on distributions  and redemption) for  the Idaho Tax-Exempt Fund for one year from November 30, 2004 through November  30, 2005 was 1.52%. Average annual total return for the five years ended November  30, 2005 was 4.21%. Average annual total return for the ten years ended November  30, 2005 was 3.72%. 

**Average Annual Total Return**(after taxes on distributions)  quotations for various periods illustrated are computed by finding the average  annual compounded rate of return over the period quoted that would equate the  initial amount invested to the ending redeemable value according to the following  formula:

P (l + T)*n* = ATVDR

Where	P = a hypothetical initial Payment of $1,000  T = average annual Total return (after any federal income taxes on distributions    and redemption)  n = number of years  ATVDR = Ending Value of the hypothetical $1,000 payment made at the beginning  of the period after any federal income taxes on fund distributions and redemption

Current Yield is computed by dividing the net investment income, as defined  by the Securities and Exchange Commission, over a rolling 30 day period for  which the yield is presented by the average number of shares eligible to receive  dividends for the period over the maximum offering price per share on the last  day of the period, and annualize the results. The formula used is:

Yield = 2[( a-b/cd +1)*6* -1]

Where   a = interest accrued during the period   b = expenses accrued for the period (net of reimbursements)   c = the average daily number of shares outstanding during the period that were  entitled to receive dividends   d = the price per share on the last day of the period

The current yield on the Idaho Tax-Exempt Fund for the 30 day period ending  November 30, 2005 was 3.93%. 

 

**Financial Statements**

The most recent audited annual report accompanies this Statement of Additional  Information. 

There is incorporated into this Registration Statement the following financial  information in the Annual Report to shareowners for the fiscal year ended November  30, 2005, Filed as Exhibit A hereto:

> 
Report of Tait, Weller & Baker LLP, Independent Registered Public Accounting    Firm.     Statement of Assets and Liabilities as of November 30, 2005.     Statement of Operations - Year ended November 30, 2005.     Statements of Changes in Net Assets - years ended November 30, 2005 and 2004.     Investments - as of November 30, 2005.     Notes to Financial Statements.

 

 

| 12 | Statement of Additional Information |
|----|-------------------------------------|

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**PART C**

 

 

**OTHER INFORMATION**

 

 

 

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**Exhibits**

Exhibits included with this filing: 

> 
Items marked with an asterisk (*) are incorporated by reference to exhibits      previously filed with the Registration Statement for Saturna Investment      Trust and amendments thereto.

(a) *Articles of Incorporation*

> 
*(1) Agreement and Declaration of Trust of Northwest Investors Tax-Exempt    Business Trust, filed February 20, 1987 with Secretary of State of Washington.    Incorporated by Reference. Filed as Exhibit No. 1 to initial filing of Form    N-1A in 1987. File No. 33-13247.    *(2) Articles of Amendment to the Declaration of Trust of Northwest Investors    Trust, as adopted by resolution of the Board of Trustees on November 24,    1992, filed with the Secretary of State of Washington December 1, 1992. Incorporated    by Reference. Filed as Exhibit No. 1(b) to Amendment No. 8 to Form N-1A dated    December 21, 1992.    *(3) Articles of Amendment to the Declaration of Trust of Northwest Investors    Trust, as adopted by resolution of the Board of Trustees on July 10, 1995.    Incorporated by Reference. Filed as Exhibit No. 1-3 to Amendment No. 13 to    Form N-1A dated July 11, 1995.    *(4) Articles of Amendment to the Declaration of Trust of Saturna Investment    Trust, as adopted by vote of the shareholders on September 28, 1995. Filed    as Exhibit No. 1-4 to Amendment No. 14 to Form N-1A dated March 29, 1996.

(b) *By-laws.*

> 
*Bylaws of Northwest Investors Trust, adopted by the Board of Trustees,    July 21, 1992. Incorporated by Reference. Filed as Exhibit No. 2 to Amendment    No. 8 to Form N-1A dated December 21, 1992.

(c) *Instruments Defining Rights of Security Holders.* Included in  (a) and (b).

(d) *Investment Advisory Contracts*

> 
*(1) Investment Advisory and Administrative Services Agreement for the series    Sextant International Fund of Saturna Investment Trust, as approved by the    Board of Trustees on July 10, 1995 and shareholders on September 28, 1995.    Filed as Exhibit No. 5-1 to Amendment No. 14 to Form N-1A dated March 29,    1996.    *(2) Investment Advisory and Administrative Services Agreement for the series    Sextant Growth Fund of Saturna Investment Trust, as approved by the Board    of Trustees on July 10, 1995 and shareholders on September 28, 1995. Filed    as Exhibit No. 5-2 to Amendment No. 14 to Form N-1A dated March 29, 1996.    *(3) Investment Advisory and Administrative Services Agreement for the series    Sextant Bond Income Fund of Saturna Investment Trust, as approved by the    Board of Trustees on July 10, 1995 and shareholders on September 28, 1995.    Filed as Exhibit No. 5-3 to Amendment No. 14 to Form N-1A dated March 29,    1996.    *(4) Investment Advisory and Administrative Services Agreement for the series    Sextant Short-Term Bond Fund of Saturna Investment Trust, as approved by    the Board of Trustees on July 10, 1995 and shareholders on September 28,    1995. Filed as Exhibit No. 5-4 to Amendment No. 14 to Form N-1A dated March    29, 1996.

(e) *Underwriting Contracts.* Distribution Agreement adopted September  20, 2004 (see Documents).

(f) *Bonus or Profit Sharing Contracts*. Not applicable.

(g)*	Custodian Agreements 

> 
Form of Custodian Agreement for each series of the Trust, between the Trust    and National City Bank, Indiana. Filed as Exhibit No. 8-1 to Amendment No.    14 to Form N-1A dated March 29, 1996.

(h)* *Other Material Contracts*

> 
*Transfer Agent Agreement for the Northwest Investors Trust between the    Trust and Saturna Capital Corporation, dated October 12. Filed as Exhibit    C to Proxy Statement dated September 21, 1990. File No. 33-13247.

(i) *Legal opinions.*

> 
Opinion of Counsel dated March 29, 2006 (see Documents)

(j) *Other opinions.*

> 
(1) Accountant’s Consents dated March 29, 2006 (see Documents)    (2) Copies of Powers of Attorney of Trustees of Saturna Investment Trust    (see Documents).

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(k) *Omitted Financial Statements*. Not applicable.

(l)* *Initial Capital Agreements*. Not applicable.

(m) *Rule 12(b)-1 Plan.* Not applicable.

(n) *A Financial Data Schedule.* Not applicable.

(o) *Rule 18f-3 Plan.* Not applicable.

(p) *Code of Ethics*

> 
Code of Ethics revised March 2006. (see Documents)

 

**Persons Controlled by or Under Common Control with      Registrant**

No person or persons are directly or indirectly controlled by or under common  control with the Registrant.

 

**Indemnification**

There is no provision for indemnification of the officers and trustees of  the Trust except as provided the Agreement and Declaration of Trust of Saturna  Investment Trust, which provisions are set forth below. The provisions of Article  IV, Section 1 and Article XI of Trust of the Registrant previously filed as  Exhibit 1 to this Registration Statement are incorporated herein by reference.

In the performance of his duties as Trustee, each Trustee shall not be personally  liable to the Trust or its shareowners for any monetary damages for any breach  of duty as a Trustee, provided that this limitation shall not be construed  as limiting the liability of the Trustee for (l) any breach of the Trustee’s  duty of loyalty to the Trust or its shareowners, (2) acts or omissions not  in good faith or which involve intentional misconduct or knowing violation  of law, (3) for the unlawful payment of dividends or redemption of shares,  or (4) for any transaction from which the Trustee derives an improper personal  benefit.

The Trustees, officers, employees and agents of the Trust are indemnified  by the Trust for the fines, judgments and costs of suit, with respect to actions  brought against them in their capacity as agents of the Trust or against them  on behalf of the Trust. However, no Trustee or officer will be protected from  liability for acts of willful misfeasance, bad faith, gross negligence or reckless  disregard of the duties involved in the conduct of his office.

The Trust may purchase and maintain insurance on behalf of any current or  past Trustee, officer, agent or employee against any liability asserted against  such person or incurred by him by reason of such capacity or status, provided,  that no such insurance may be maintained if such would indemnify such person  for willful misfeasance, bad faith, gross negligence or reckless disregard  of the duties involved in the conduct of his office.

The Trustees, officers and agents of the Trust have no power to bind any past  or present shareowner of any Fund of the Trust solely by reason that the shareowner  is an owner of a beneficial interest in any Fund. Each such shareowner shall  be entitled to indemnification from the Trust for any recovery against him  solely by reason of his capacity and status as a shareowner.

The Trustees may provide in agreements of the Trust provisions setting forth,  to the extent considered necessary, the limitations of liabilities of the Trust  to the assets of shareowners, officers, agents and employees of the Trust.  The Investment Advisory Agreement, Distribution Agreement, Custodian Agreement  and Transfer Agent agreement of the Trust contain such a provision.

 

**Business and Other Connections of Investment Adviser**

The answer to this item is fully disclosed in Part A and Part B of the Form  N-1A.

 

**Principal Underwriters**

The broker-dealer subsidiary of the Adviser, Saturna Brokerage Services, Inc.,  acts for the Trust as “distributor,” without fee or compensation  of any kind, under authority of a Distribution Agreement adopted by the Trustees  on September 20, 2004.

Officers and employees of Saturna Brokerage Services, Inc. receive no compensation  (salary or commissions) from Saturna Brokerage Services, Inc. The only compensation  paid employees of Saturna Brokerage Services, Inc. or of Saturna Capital Corporation  is salary and bonus.

 

**Location of Accounts and Records**

With the exception of those records maintained by the Custodian, National  City Bank, Indiana, 101 W. Washington Street, Indianapolis, Indiana, 46255,  all records of the Trust are physically in the possession of the Trust and  maintained at the offices of Saturna Capital Corporation, 1300 N. State Street,  Bellingham, Washington 98225.

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**Management Services**

There are no management-related contracts in which service is provided to  the Trust other than those discussed in Parts A and B of this Form N-1A.

 

**Signatures**

Pursuant to the requirements of the Securities Act of 1933 and the Investment  Company Act of 1940, the Trust has duly caused this registration statement  to be duly signed on its behalf by the undersigned, duly authorized, in the  City of Bellingham, State of Washington, on the 29th day of March, 2006.

> 
SATURNA INVESTMENT TRUST        By /s/ Nicholas F. Kaiser        Nicholas F. Kaiser,        President

Pursuant to the requirements of the Securities Act of 1933 and the Investment  Company Act of 1940, this amendment has been signed below by the following  persons in the capacities and on the date indicated.

| Signature                                                                                                                                                                   | Title                                                           | Date                   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------|------------------------|
|  

/s/ Nicholas F. Kaiser        Nicholas F. Kaiser                                                                                                                    |  

President; Trustee        (Principal Executive Officer) |  

March 29, 2006 |
|  

/s/Christopher R. Fankhauser        Christopher R. Fankhauser                                                                                                       |  

Treasurer        (Principal Financial Officer)          |  

March 29, 2006 |
|  

**John E. Love        **John S. Moore        **Gary A. Goldfogel        **Herbert G. Grubel

**By /s/Nicholas F. Kaiser        Nicholas F. Kaiser, Attorney-in-fact |  

All Other Trustees                                      |  

March 29, 2006 |

  

  

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