Idaho Tax-Exempt Fund
Idaho Tex-Exempt Fund Template Header

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY


Investment Company Act file number: 811-05071

SATURNA INVESTMENT TRUST
(Exact Name of Registrant as Specified in Charter)

1300 N. State Street
Bellingham, Washington 98225-4730

(Address of Principal Executive Offices, including ZIP Code)

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

Registrant’s Telephone Number- (360) 734-9900

Date of fiscal year end: November 30, 2009
Date of reporting period: August 31, 2009

Saturna Investment Trust, Idaho Tax-Exempt Fund
 
Municpal Bond Quantity Market Value % Portfolio Maturity Industry
Ada & Canyon JSD #2 Meridian 50,000 $58,967 0.44% 7/30/15 Schools
Ada & Canyon JSD #2 Meridian 165,000 $181,254 1.36% 8/15/20 General Obligations
Ada & Canyon JSD #2 Merdian 155,000 $169,215 1.27% 8/15/21 General Obligations
Ada & Canyon JSD # 3 Kuna 500,000 $548,335 4.12% 9/15/19 General Obligations
Washington & Adams Co.s JSDC # 432 100,000 $106,647 0.80% 8/15/19 General Obligations
Bingham Co. SCD #52 Snake HS 400,000 $403,312 3.03% 9/1/27 General Obligations
Bingham Co. Id. SCD # 55 Blackfoot 285,000 $303,086 2.28% 8/1/17 General Obligations
Blackfoot ID COP Series 2000 135,000 $138,837 1.04% 2/1/18 Utility - Waste Mangmt
Blaine County Idaho Series A 150,000 $154,086 1.16% 8/1/23 General Obligations
Boise Co. ID SD # 73 Horseshoe Bend 125,000 $126,991 0.95% 7/31/10 Schools
Boise City ID Gen Fund Rev 160,000 $168,397 1.27% 12/1/17 Finance - Services
Boise City ID Gen Fund Rev 100,000 $104,910 0.79% 12/1/18 Finance - Services
Boise State Univerity ID Rev's 250,000 $253,198 1.90% 4/1/27 Schools
Boise State University Rev 09 Ser A 385,000 $395,907 2.97% 4/1/34 Schools
Boise City Urb Ren Agy Lease Rev 160,000 $171,987 1.29% 8/15/20 Real Estate - Development
Boise City Urb Ren Agy Lease Rev 90,000 $96,020 0.72% 8/15/21 Real Estate - Development
Bonneville & Bingham Co ID SCD 93 150,000 $162,590 1.22% 9/15/16 General Obligations
Bonneville & Bingham Co JSD #93 GO 350,000 $371,231 2.79% 9/15/17 General Obligations
Caldwell ID GO 150,000 $153,494 1.15% 5/15/14 General Obligations
Canyon Co. ID SCD # 131 Nampa 325,000 $345,283 2.59% 8/15/19 Schools
Canyon Co. ID SCD # 131 Nampa 105,000 $109,661 0.82% 8/15/23 General Obligations
Canyon Co. ID SCD #134 Middleton 170,000 $179,054 1.35% 7/31/16 General Obligations
Canyon Co. Id SCD #139 Vallivue 350,000 $353,801 2.66% 9/15/25 Schools
Fremont & Madison JSD 215 St. Antho 200,000 $213,596 1.60% 8/15/19 General Obligations
Idaho Bond Bank Authority Rev 135,000 $138,663 1.04% 9/1/22 Pollution Control - Servcs
Idaho Bond Bank Authority 250,000 $264,563 1.99% 9/15/26 Utility - Water Supply
Idaho Bond Bank Authority 75,000 $76,226 0.57% 9/15/23 Utility - Waste Mangmt
Idaho Bond Bank Authority 90,000 $93,304 0.70% 9/15/19 Finance - Services
Idaho Bond Bank Authority Rev Ser B 100,000 $102,557 0.77% 9/15/24 Diversified Operations
Idaho Falls ID Electric 140,000 $164,895 1.24% 4/1/19 Utility - Electric Power
Idaho Health Fac Ath Holy Cross Rev 50,000 $50,089 0.38% 12/1/28 Medical - Hospitals
Idaho Health Facs Auth Rev Ref. 110,000 $110,589 0.83% 12/1/14 Medical - Hospitals
Idaho Health Facs Auth Corp 115,000 $115,575 0.87% 12/1/22 Medical - Hospitals
Idaho Health Facs Aith Rev 200,000 $216,800 1.63% 12/1/23 Medical - Hospitals
Idaho Housing & Finance Assoc. 100,000 $109,660 0.82% 6/1/17 Schools
Idaho Housing & Finance Assoc 200,000 $214,128 1.61% 7/15/24 Transportation - Services
Idaho Housing & Finance GARVEE TR-A 250,000 $251,800 1.89% 7/15/23 Roads
Idaho Housing & Finance GARVEE TR-A 50,000 $52,231 0.39% 7/15/27 Roads
Idaho Housing & Fin Ass SF Rev 100,000 $102,846 0.77% 7/1/28 Housing
Idaho State Building Authority 110,000 $112,215 0.84% 9/1/23 Building - Resident/Commercl
Idaho State University Ref & Impt 150,000 $150,048 1.13% 4/1/17 State Education
Idaho State University Rev. 220,000 $226,153 1.70% 4/1/24 State Education
Jefferson & Madison SCD 251 Rigby 100,000 $103,461 0.78% 9/1/24 General Obligations
Jerome ID Urban Renewal District 200,000 $202,952 1.52% 9/1/13 Real Estate - Development
Jerome Lincoln Gooding Co's JSC 261 125,000 $131,281 0.99% 9/15/18 General Obligations
Jerome Lincoln Gooding Co's JSD 261 250,000 $272,950 2.05% 9/15/22 General Obligations
Kootenai-Shonshone Area Librarys 220,000 $230,652 1.73% 8/1/21 General Obligations
Latah Nez Perce Clearwater JSD 283 190,000 $198,685 1.49% 8/15/27 General Obligations
Lemhi County ID GO 100,000 $105,222 0.79% 8/1/15 General Obligations
Madison Co. SCD # 321 Rexburg UTGO 410,000 $420,430 3.16% 8/15/24 General Obligations
Madison Co. SCD # 321 Rexburg UTGO 250,000 $252,360 1.90% 8/15/26 Schools
Meridian ID Free Library District 100,000 $101,129 0.76% 8/1/15 General Obligations
Minidoka & Jerome JSD # 331 75,000 $77,852 0.58% 8/15/18 General Obligations
Minidoka & Jerome JSD # 331 75,000 $76,883 0.58% 8/15/20 General Obligations
Minidoka & Jerome JSD 331 225,000 $225,731 1.70% 8/15/24 General Obligations
Minidoka & Jerome JSD # 331 160,000 $160,755 1.21% 8/15/25 General Obligations
Moscow Idaho Sewer Revenue 200,000 $205,344 1.54% 5/1/28 Utilities - Sewer
Nampa Idaho Series B 200,000 $209,464 1.57% 8/1/20 General Obligations
Nez Perce County (Jail) 2007 COP 150,000 $154,862 1.16% 2/1/21 Municipal Leases
Owyhee & Canyon Co SD 370 Homedale 160,000 $182,118 1.37% 8/15/16 Schools
Owyhee & Elmore SD 365 Grandview 350,000 $370,052 2.78% 8/15/27 Schools
Payette Co ID SCD #373 100,000 $107,856 0.81% 9/15/24 Schools
Pocatello ID Water Rev 100,000 $100,763 0.76% 2/1/24 Utility - Water Supply
Pocatello ID. Water Revenue 350,000 $357,287 2.68% 2/1/26 Utility - Water Supply
Post Falls LID 2004-1 300,000 $299,985 2.25% 5/1/21 Real Estate - Development
Troy ID Sewer System 20,000 $20,021 0.15% 2/1/10 Utilities - Sewer
University of Idaho Rev.s 200,000 $211,234 1.59% 4/1/19 State Education
University of Idaho Rev's 260,000 $273,671 2.06% 4/1/20 State Education
Valley & Adams JSD # 421 McCall 135,000 $139,119 1.05% 8/1/22 General Obligations
Valley & Adams JSD 421 McCall 290,000 $295,684 2.22% 8/1/24 Schools
 
  TOTAL $13,310,003 100.00%    
*Fair valued, see explanation below          

 

Fair Value Measurments Disclosure:

The Funds adopted Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements" ("FAS 157"), effective December 1, 2007 (March 30, 2007 for Core Fund). In accordance with FAS 157, fair value is defined as the price that the Fund would receive to sell an investment or pay to transfer a liabilityin an orderly transaction with an independent buyer in the principal market, or in the absence of a principal market the most advantageous market for the investment or liability. FAS 157 establishes a three-tier hierarchy to distinguish between (1) inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) inputs that reflect the reporting entity's own assumptions about the assumptions market participants would use in pricing an asset or liability developed based on the best information available in the circumstances (unobservable inputs) and to establish classification of fair value measurements for disclosure purposes. Various inputs are used in determining the value of the Fund's investments. The inputs are summarized in the three broad levels listed below.

Level 1 — quoted prices in active markets for identical investments
Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)
Level 3 — significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments)

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The following is a summary of the inputs used as of August 31, 2009 in valuing the Funds' investments carried at value:

LEVEL
VALUATION INPUTS
INVESTMENTS IN SECURITIES
    STBFX SBFIX SCORX SSGFX SSIFX NITEX
LEVEL 1 Quoted Prices $- $- $3,379,333 $14,959,154 $45,198,502 $-
LEVEL 2 Other Significant Observable Inputs $3,461,270 $3,336,633 $1,344,954 $- $- $12,708,410
LEVEL 3 Significant Unobservable Inputs $- $- $- $- $- $601,593
TOTAL   $3,461,270 $3,336,633 $4,724,287 $14,959,154 $45,198,502 $13,310,003
 

 

Level 3 Roll-Forward
Municipal Securities

   
Beginning Balance
$599,236
Total unrealized gains or losses
$2,357
Ending Balance
$601,593


Odd Lots:

The bid-side valuations provided by the independent pricing service are for institutional "round-lot" holdings ("Round Lots"). Round Lots consist of 100 bonds (approximately $100,000 each). Some of the Fund's holdings consist of less than an institutional Round Lot and are considered "Odd Lots." Odd Lots trade at a discount to Round Lots to compensate for the effect of the fixed costs associated with any trade. To reflect this discount, the Fund applies a discount to the valuation of Odd Lot holdings as shown in the following chart:

Total Face Value

Adjustment to Price

Under 10,000
-0.750
10,000-24,999
-0.625
25,000-49,999
-0.500
50,000-74,999
-0.375
75,000-99,999
-0.250
100,000 and up
none

In April 2009, the Financial Accounting Standards Board ("FASB") issued FASB Staff Position No. 157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly ("FSP 157-4"). FSP 157-4 provides additional guidance for estimating fair value in accordance with FASB Statement of Financial Accounting Standards No. 157, "Fair Value Measurements" ("FAS 157"), when the volume and level of activity for the asset or liability have significantly decreased as well as guidance on identifying circumstances that indicate a transaction is not orderly. FSP 157-4 is effective for fiscal years and interim periods ending after June 15, 2009. Management is currently evaluating the impact the adoption of FSP 157-4 will have on the Funds' financial statement disclosures.

Item 2. Controls and Procedures

Internal control over financial reporting is under the supervision of the principal executive and financial officers. On October 21, 2009, Mr. Nicholas Kaiser (President) and Mr. Christopher Fankhauser (Treasurer), reviewed the internal control procedures for Saturna Investment Trust and found them reasonable and adequate.

Item 3. Exhibits

Certification of Principal Executive Officer and Principal Financial Officer of the Registrant as required by Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is attached hereto as Exhibit 99CERT.

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

SATURNA INVESTMENT TRUST

By:

/s/ Nicholas Kaiser
Nichola Kaiser, President

Date: October 26, 2009



Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:

/s/ Nicholas Kaiser
Nicholas Kaiser, President

Date: October 26, 2009


By:

/s/ Christopher Fankhauser
Christopher Fankhauser, Treasurer

Date: October 26, 2009